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Mark Cuban: Facebook Is Driving Away Brands — Starting With Mine 299

Posted by Soulskill
from the monetizing-your-eyeballs dept.
concealment sends this quote from an article at ReadWriteWeb: "Tech billionaire and Dallas Mavericks owner Mark Cuban says he is fed up with Facebook and will take his business elsewhere. He's sick of getting hit with huge fees to send messages to his team's fans and followers. Two weeks ago Cuban tweeted out a screen grab of an offer he'd received from Facebook. The social network wanted to charge him $3,000 to reach 1 million people. Along with the screen grab, Cuban wrote, 'FB is blowing it? This is the first step. The Mavs are considering moving to Tumblr or to new MySpace as primary site.'"
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Mark Cuban: Facebook Is Driving Away Brands — Starting With Mine

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  • Cuban is bluffing... (Score:4, Interesting)

    by Anonymous Coward on Tuesday November 13, 2012 @03:01PM (#41972403)

    Seriously, MySpace?!

  • Not a bad deal (Score:3, Interesting)

    by Anonymous Coward on Tuesday November 13, 2012 @03:01PM (#41972413)

    1,000,000 users / $3000 = $0.003 per user

  • by c0lo (1497653) on Tuesday November 13, 2012 @03:07PM (#41972495)
    From TFA

    Facebook constantly tinkers with EdgeRank to make it more effective, says product manager Will Cathcart. The algorithm change in September was a bigger change than usual, Cathcart says, but its goal was simply to cut down on spam in people's news feed.

    FB: "Unless you pay for delivery, we'll be fighting your spam".

    End result:
    * the "network socialite" doesn't actually "socialize" anymore - it's advertising
    * the others will still be served spam

    Must be that FB is really desperate for revenue.

  • Re:That is cheap (Score:5, Interesting)

    by Hatta (162192) on Tuesday November 13, 2012 @03:11PM (#41972589) Journal

    .3 cents per person is really pretty cheap. Somehow telemarketers stay in business, and they're paying someone $8/hr to make what 20 calls an hour? If it's not worth .3 cents per person to contact them, you probably have no actual business contacting them at all.

  • by Heebie (1163973) on Tuesday November 13, 2012 @03:36PM (#41972947) Homepage
    How stupid are you in the first place? Your primary "site".. your primary online presence.. should be YOUR OWN WEBSITE. This has been a marketing no-brainer since the mid 1990's. DUH.
  • Re:That is cheap (Score:5, Interesting)

    by Enderandrew (866215) <enderandrew@gm[ ].com ['ail' in gap]> on Tuesday November 13, 2012 @04:15PM (#41973487) Homepage Journal

    This is precisely a bait and switch. You promise a free service, refuse to offer the free service and then demand money for the exact same functionality that was promised for free.

    Combine this with recent accusations that Facebook's feeds have been broken on purpose as of late to necessitate promoting posts, and accusations of click-fraud eating up paid advertising and you have to wonder if Facebook is beginning to shoot themselves in the foot. They have tons of users, but they don't seem to know how to monetize that well.

    http://memeburn.com/2012/11/is-facebook-really-broken-on-purpose/ [memeburn.com]

    http://www.businessinsider.com/facebook-accused-of-click-fraud-by-advertiser-2012-7 [businessinsider.com]

  • Re:That is cheap (Score:5, Interesting)

    by _xeno_ (155264) on Tuesday November 13, 2012 @04:26PM (#41973625) Homepage Journal

    .3 cents per person is really pretty cheap.

    Is it? If you read the actual article, Cuban's complaints seem to be that there are extra costs not included in that figure. Part of his problem is that they had to advertise for Facebook to drive people to their Facebook page in the first place. So there's already money invested which should be taken into consideration as part of the "cost per person."

    He also points out that since it's variable and on a per-post basis, it's basically impossible for them to plan ahead - they can't say "OK, we're dedicating $100,000 this year to our Facebook budget" and then choose when and what to post based on that, as the price per post can change. He also seems to suggest that this actually increases the costs, as it adds a new layer of accounting for every post.

    I find that second argument to be the most persuasive. If the cost per post really does change and budgeting really is impossible, then yes, that's definitely a problem and one that Facebook should fix. He seems to be OK with the idea of paying Facebook, but he wants the costs to be known ahead of time and paid up front, rather than on a per-post basis.

    Cuban also appears to be betting that, since they have to advertise to get people to the Facebook page in the first place, he can advertise their Twitter feed and get people to follow that, instead. That way their upfront costs would remain the same, but they wouldn't have extra unexpected and unknowable costs in the future. I'm not sure I entirely believe this, but if he's right and it's their advertising that's driving people to their Facebook page and not Facebook as a platform itself, then why should he pay Facebook extra for the privilege of needing to advertise for them in the first place?

    Of course, I suppose we'll only find out if he's right in a year or two, after he tries out moving to other platforms. I'm not so sure he is, but then again, I never "liked" any businesses on Facebook in the first place.

  • Re:That is cheap (Score:4, Interesting)

    by vux984 (928602) on Tuesday November 13, 2012 @08:50PM (#41976451)

    All he has to do is convince a million of his fans to leave Facebook and setup their own pod.

    Pretty much.

    Technically speaking, you are right, they just provide RSS feeds. A billion or so of them, filtered and correlated and available 24x7. With unlimited photo storage, the ability to update the feeds from a smartphone in an app so easy to use that everyone from a 2 year old kid to an 80+ year old grand parent can use.

    The problem isn't SAAS per se, its the lock in to the facebook platform. If I shell out for a hosted Joomla or Drupal or whatever flavor of the day CMS you like... Diaspora even. That can be outsourced SAAS, and I could have 5 9's uptime and effectively unlimited photo storage, and enough bandwidth to serve millions for pretty close to chump change.

    But I'd be in shock if the host one day decided to charge me $3000 to post an update to the site's RSS feed. ... The thing is, such a think already exists. www.nba.com Obviously that site did not have the market penetration that the Mavericks needed. If it did, they would have been better off convincing people to visit www.nba.com/mavericks, instead of Liking a FB page.

    Exactly, this BLEW my mind, when I started seeing major enterprises who ALREADY had web functional presences sending their users off to facebook/what-am-i-thinking

    They should have had the spigot turned the other way, let users find them on facebook, like the on facebook, whatever, but have all that as a launchpad to www.my-own-bloody-site.com.

    Facebook owns the market segment called Facebook.

    And this is only valuable because enterprises fell over themselves to get onto it. They handed over the power to connect with users to be cool, or something.

    Half the people I know with facebook accounts only created them precisely to enter a contest, or leave a comment, or some other nonsense on a site that should have hosted it themselves.

    As an enterprise, you absolutely want to be able to connect with facebook users, and go after that segment, but the last thing you should be doing is driving users into facebook, and becoming dependent on it.

    That is simply too stupid for words; and yet its exactly where a lot of companies are right now.

Nothing will dispel enthusiasm like a small admission fee. -- Kim Hubbard

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