I always wondered how Facebook made money since they don't sell anything. But, I do appreciate it being free. I have my own site on there with over 100 people, and we've become like a big, extended family. I would so hate to lose touch with my members.
They provide entertainment and charge advertisers -same business model as a TV station and a sound one at that. It's not Facebook as a company which is in trouble – only the people who paid way too much for the stock.
If the viewers were responsible for providing the TV shows and the networks and stations did nothing but give us the platform for that, the analogy would work. But in this case, Facebook doesn't provide entertainment, WE provide the entertainment. And that will end as soon as people decide it's no longer cool to post there. Same thing that happened with Myspace, Friendster, and the others. It can always be profitable, but it's not a sound investment.
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