It may never be clear how much General Motors' public disparagement of Facebook advertising helped cool investor enthusiasm for the social network.
But even if Facebook's IPO woes owe more to problems with stock trading software and skepticism among financial industry insiders than to GM's claim that Facebook advertising doesn't work, the automaker's dissatisfaction with Facebook ads bears further consideration.
Facebook is clearly worth a lot of money. Perhaps not the $100 billion argued with the opening share price of $38, but its present $70 billion market capitalization is not a trivial valuation.
At the same time, other tech companies that straddled advertising and content have flown high and fallen. AOL had a valuation of $222 billion in December 1999. Today, it's worth about $2.6 billion. Yahoo, the darling of the 1990s, is still trying to recapture its glory days after years of uninspired management. Read More
But even if Facebook's IPO woes owe more to problems with stock trading software and skepticism among financial industry insiders than to GM's claim that Facebook advertising doesn't work, the automaker's dissatisfaction with Facebook ads bears further consideration.
Facebook is clearly worth a lot of money. Perhaps not the $100 billion argued with the opening share price of $38, but its present $70 billion market capitalization is not a trivial valuation.
At the same time, other tech companies that straddled advertising and content have flown high and fallen. AOL had a valuation of $222 billion in December 1999. Today, it's worth about $2.6 billion. Yahoo, the darling of the 1990s, is still trying to recapture its glory days after years of uninspired management. Read More