The IPO for the largest social media player and the catalyst for an entire internet sector has been in the making for quite some time. Facebook has been mounting strength sine the first account was opened and friend request send back at Harvard in 2004. The value has always been in the community is has achieve, the immense interconnected network it facilitates, and the mass of personal information.
As written about a great deal and portrayed on film since the company's inception, Founder and CEO Mark Zuckerberg was careful to attach advertising and overt revenue-generation in the early-going to avoid taking the cool factor out of the platform before it had a chance to take off and flourish. At that point, the decision-makers did not know what exactly Facebook was and what it could be. Today, it is much different, Facebook is going public and revenue-generation is a very large piece, may be the largest, of their operation out of necessity as they step into the realities of a large-scale publicly traded company.
This is all very exciting for the company, but this excitement comes with some hesitation and some real questions as to the viability of the advertising heavy business model that they have assumed as 82% of their current revenue is generated by advertising. After making the transition to advertising in various forms, the platform now has to sustain advertising's wide use and continue its growth, something that not all in the industry are positive will be easy to do. This is in part due to the fact that although Facebook is the essential dominant player in social media, their dominance may wane in the years to come as other existing platforms assert themselves to a greater degree and still others not yet formed can rise quickly offering a different experience drawing some market share. Additionally, the viability of ads on the platform may evolve potentially decreasing as user behavior on Facebook evolves impacting the foundation upon which Facebook's future is built.
Facebook also will be collaborating with Microsoft, as was just announced, to have more results pulled from Facebook (and other networks) when web users search in Microsoft's Bing search engine akin to Google's Search, Plus Your World. This partnership is a clear attempt to stay competitive with Google in the search game and keep the relevance of Facebook information in search. It has not all been good news, however, as auto giant General Motors has announced they will pull all its advertising from the platform. Being the third largest advertiser in the in the US, GM's advertising decisions carry weight and this move is a blow to Facebook during the most important week of its existence. But, there are caveats to this as although GM has been advertising on Facebook since 2008, they lean most heavily on direct-marketing, and Facebook does not necessarily deliver that experience. This brings up the point that Facebook ads are better suited for some companies more than others.
The world will be watching the launch very carefully and those in the SEO and internet marketing community will be continually tracking how advertising continues in comparison to AdWords and other paid search marketing efforts.