Market Currents
If the rumors of a Facebook (FB) phone are true, investors should consider abandoning ship, says...
-
Monday, May 28, 2012, 12:25 PM ETIf the rumors of a Facebook (FB) phone are true, investors should consider abandoning ship, says Henry Blodget. The company would have to face intense and entrenched competition to establish itself in a field that could hurt its own margins in a move that smacks of defensive desperation.
Other date
TECH ETFs IN FOCUS
Latest Tech Articles
This news story has 26 comments:
I see this is as bullish as instead of the stock being 100% terrible it is now instead 99% terrible as there is at least some chance the phone could work out.
In a move that smacks of egotistical hubris.
Seems like he has forgotten Apple’s margin. Hardware as a standalone business is not a good business but Hardware plus software combine has done wonders for the one company (Apple) which has tried it. And Facebook is not the only one trying: Google has acquired Motorola and may launch Google Phone, Microsoft and Nokia are also trying to make it work.
Refer http://bit.ly/L7RZ2E for more details :)
The reality in the phone market is that Apple is gaining, the others surviving.
FB is too expensive. But I have seen NFLX and something expensive can become more expensive (before the inevitable sink). So I am not short FB (yet)
This also misses the point that cell phones are carrier centric, not hardware maker centric. So cracking the market is a tall order.
The argument that the FB experience on an FB phone will be more integrated is laughable. There's nothing preventing FB from coding whatever experience they want into Android using the API now or partnerships with makers. HTC would kill to offer a branded FB phone, as would ZTE or other tertiary makers fighting for recognition. In the increasingly cutthroat handset space, with iOS and Android being joined possibly by WinMo and BB10, there is so much opportunity for FB to leverage their name and services for a very nice premium while remaining strictly software.
Which in fact might be what they're planning with all this. In which case I'll praise them.
and what makes you think just because someone has an FB account he/she wants a FB phone ?
I have a FB account out of necessity - to keep in touch with my larger circle of friends. I check my account every a couple of days but do not dwell long. As a happy camper of Apple products, I will never get an FB phone, even if it's free as I don't want to carry two phones.
Most of my friends are like me - how they use their FB accounts or some simply resist to have an FB accounts. If FB cuts of native app access on other platforms, I'll tolerate accessing from web.
Sure everything is possible - FB can be as good as Apple in hardware design, platform, ecosystem, and beat Apple on supply chain. While at the same time, kill Android/google, Microsoft .. along the way. but let's just say it's no trivial matter. Speaking of margin - in the mobil market, Apple grabs 70% of revenue, Samsung about 25%, HTC 1%, the rest are not making money or losing money. Apple does not get to where it is by one or two tricks.
and FB will never be able to get to billions of people in China. Even if it's not blocked, FB will not be able to compete with the giangantic home grown social networks there.
FB found cure for cancer!
FB resolved EU debt problem!
http://bit.ly/M0eDiJ
1) Facebook has over 900 million users, If we account for individuals with multiple accounts where still in the hundreds of millions. That is nearly a billion potential customer base and growing that the FB brand can market their phone too. Obviously, we must account for those who can actually afford the smart phone to begin with, however, I'm not sure of anyone else with a larger list to market to.
2) "The Future is Mobile." No programmer can deny this, the smart phone market is growing fast, the 3rd worlds are buying them more than desktops, even Africa is seeing exponential increase and they are spending large fractions of their minute salaries to purchase data. Smart phones and mobile apps are the future period.
3) Facebook is your identity on the web. It always amuses me how often the haters brag about deleting their profile, yet FB continues to grow, lol. Why not stop using technology all together? More and more websites are offering FB as the alternative login for their websites. This is your ID on the web and it isn't stopping anytime soon.
4) Competition. Facebook came first period. It offered a clean user interface that was simple and engaging allowing people to interact with family and friends. At first it was reserved to those invited but it was set apart because it came first. That's it. No other company is taking it over anytime soon, they have time to figure things out.
The stock may continue to decrease for a little bit but the company's long term strategy, so long as they are able to execute it with precision will ensure this stock does very well in the next 5 years. So yeah, keep hating and bringing it down so I can buy :)