Operating at the Intersection of Technology and the Capital Markets
Tag: Facebook
As I think about Technology companies in the back half of 2023 and 2024, pricing power has to erode at some point. For companies such as Google, subscription price increases this calendar year have far outpaced revenue growth (higher prices, fewer unit sales). I imagine that many companies that exercised pricing power in 2021, 2022 … Continue reading Pricing Power in 2H 2023 and 2024
The cynic in me has never believed that Meta has been honest about the number of active users on its platform, daily usage, user engagement, etc. First, I've previously quoted the Pew Research survey below (first chart). My personal experience with young people in my family reflects the Pew survey data represented in the chart … Continue reading Meta’s Deepfake
It feels like META gave these poor performance reviews in order to not get crosswise with California employment law ahead of more planned employee terminations. My view is that META will never find its way back in terms of making Facebook and Instagram the "destination" platforms they once were. Facebook lacks a product identity. Instagram … Continue reading META Is Lost
Neal Mohan is YouTube's Chief Product Officer and will replace Susan Wojcicki who is stepping down. I like that a Product person will lead YouTube. It is mission critical to have "product" at the center of these massive content platforms to ensure optimal user experiences (Look to Meta Platforms for examples of how to ruin … Continue reading New YouTube Chief: Neal Mohan
At some point the market has got to reconcile with economic reality. META is a case in point. META's core business is selling Ads. META's price per Ad declined 16% year-over-year for calendar 2022 and declined 22% year-over-year in Q4'22 (unit pricing is likely to get worse in my view in 2023). META's Q4'22 Revenue … Continue reading META and The Market
Analysts estimate that META will grow revenues in 2023 over 2022. However, the estimates I see imply that revenue growth will be back-end loaded. We know how that usually ends. I see META struggling to generate year-over-year Revenue growth and expect for 2023 to be a down Revenue year. Zuckerberg is not an Operator. META's … Continue reading META: Where Will Growth Come From?
The WSJ reports that YouTube is negotiating with the NFL for exclusive rights to broadcast NFL Sunday Ticket. YouTube/Google and Amazon Prime (Thursday night NFL games), are essentially pursuing a U.S. audience with their respective NFL strategies. The NFL ought to court YouTube in particular given that YouTube - not TikTok, not Instagram nor Snap … Continue reading YouTube & The NFL
Lina Khan's FTC is bad news. It reminds me of the FTC during the Obama Administration - quick to pick a fight with companies (I know from first-hand experience), without understanding the competitive landscape or how markets work. In this case, Microsoft's Xbox unit is the platform and Activision is the content publisher that will … Continue reading FTC Sues To Block Microsoft’s Activision Acquisition
The WSJ reports that headcount cuts are coming to META, perhaps on Wednesday of this week. META's R&D expense grew by 45% y-o-y in the September quarter even as Revenue declined by almost 5%. G&A grew by 15% and Sales & Marketing grew by 6%. Given that R&D now represents 33% of Revenue (as compared … Continue reading Where META May Reduce Headcount
META will remain a broken company until Zuckerberg allocates the same passion toward repairing the core business as he has allocated toward building the metaverse. However, I have never met an entrepreneur that felt equally passionate about a shiny new object AND a repair job. Therein lies the rub. Zuckerberg's interests have clearly evolved. META's … Continue reading META Ought To Split In Two
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