Is Mark Zuckerberg the Next Steve Case?

theodp writes "With all signs for Facebook pointing up, author Douglas Rushkoff goes contra, arguing that Facebook hype will fade. 'Appearances can be deceiving,' says Rushkoff. 'In fact, as I read the situation, we are witnessing the beginning of the end of Facebook. These aren't the symptoms of a company that is winning, but one that is cashing out.' Rushkoff, who made a similar argument about AOL eleven years ago in a quashed NY Times op-ed, reminds us that AOL was also once considered ubiquitous and invincible, and former AOL CEO Steve Case was deemed no less a genius than Mark Zuckerberg. 'So it's not that MySpace lost and Facebook won,' concludes Rushkoff. 'It's that MySpace won first, and Facebook won next. They'll go down in the same order.'"

Re:Second life

[Anonymous Coward]

From what I hear Second Life is still thriving except everyone's hanging out in the adult section which can only be reached by teleporting over to those areas so they can don their fursuits and three foot furry blue penises.

Re:If a

[TheRaven64]

And your account can be unilaterally removed because they don't like how you are using that. I know two people who have had their Facebook accounts removed. There are people uploading their photographs to Facebook and not keeping backups, without realising that Facebook can permanently remove their ability to access them on a whim.

There's one BIG difference.

[Dr. Evil]

....for whatever reason. People signed on to Facebook with their real names.

It's the first popular social network where you can actually find people from real life.

i bet..

[omgtofu]

IRC will make a miraculous comeback!

Re:You're a target

[shadowrat]

Nobody forces you to put your wife's maiden name on facebook. Facebook even prevents unauthorized access to any info you post. I assume you also wouldn't send an email containing a picture of grandpa jones because that can be easily intercepted. Even if you encrypt it, one careless recipient could forward it without encryption.

Your best protection against identity theft is knowing what you can and can't post. You seem to have that knowledge so I don't know what you would have to lose by posting some casual fb updates.

Comment removed

[account_deleted]

Comment removed based on user account deletion

Hey, Lawrence Welk!

[Jeremiah Cornelius]

Cue the Bubble Machine!

Facebook and Goldman Sachs unleashed a tech investing mania this week compared far and wide with the euphoric 1990s dot-com run-up. By arranging a $500 million private investment, at a staggering $50 billion valuation, Goldman at once delayed a Facebook public offering (now expected in 2012), prompted a likely LinkedIn IPO, and thrilled its clients, who clamored for a piece of Mark Zuckerberg's behemoth.

But for all the nostalgia for pre-IPO "friends and family" stock in Pets.com, the dot-com era comparisons are off base. Instead, Goldman's Facebook deal mirrors the subprime collateralized debt obligation deals that blew up entire companies, as well as crater-size hole in our economy. In fact, what Goldman just engineered might well be worse...

the Facebook phenomenon shows us that nothing has changed. Goldman again moved aggressively to get the business--investing $75 million into Facebook early, at a low valuation, through one of its hedge funds, in the same way it used to get CDOs rolling--again will rake in the fees (to the tune of $60 million--upfront) and again will pawn off the overvalued results to its clamoring clients, who don't have nearly as much information as Goldman.

If you're one of those investors, here's the deal in a nutshell: You get to buy shares, forking over 5 percent of any possible gains, on top of a 4 percent placement fee and a 0.5 percent expense reserve fee (so you're down 10 percent before the game starts) in a private company that doesn't have to disclose any pertinent financial information to you or any regulator for 15 months. For the privilege, Goldman gets its eight-digit windfall.

The rich Goldman clients aren't allowed out until 2013. But Goldman is. ...The rich Goldman clients who must pony up a minimum $2 million investment aren't allowed out until 2013. No exceptions. Ditto Facebook employees (although they were allowed to cash out about $100 million last year). But Goldman is. Whenever it wants "without notice to the fund or investors in the fund."

CDOs were private, unregulated, overvalued, disclosure-lite, fee-intensive deals. The Facebook deal is private, unregulated, overvalued, disclosure-lite, and fee intensive. CDOs sold like mad-- until they didn't. That can happen here. At the end of the holding period, there may be no bid for Facebook shares anywhere near the price paid. Plus, by that time all the enthusiastic global users of Facebook may have dropped it for thenextgreatfad.com taking the advertiser money along with them.

The Facebook deal sucks so badly that one of Goldman Sachs' own funds didn't want a single share of it. Richard Friedman, who runs the money for past and present Goldman partners, among others, said, thanks, but no thanks. That should tell everyone something...

http://www.thedailybeast.com/blogs-and-stories/2011-01-07/goldmans-facebook-voodoo-why-its-social-media-deal-is-worse-than-toxic-mortgages/?cid=columnists [thedailybeast.com]