- Quick summaries of each companies goals andaccomplishments
Facebook 901 million monthly active users (MAUs) 3.2 billion likes & comments, 300 million photos uploaded per day 125 billion friendships Mission: To make the world more open and connect(Facebook, 2012, p. 2-3)
Zynga Leading social game provider with 240 million MAUs in 175 countries They develop and operate live online game through social sites and mobile platforms. All games are free to play Zynga has achieved great finical growth by increasing their revenue from 121.5 million to 1.14 billion from 2009 to 2011.(Zynga inc, 2011, p. 2) (Edwards, 2012)
GoogleGoogle is a global technology leader focused on improving information and connecting peopleGoogle’s goal is to organize information and make it universally accessible and useful.In 2011 Google’s annual number of searches was 1,722,071,000,000Google averages 4,717,000,000 searches per day(Google Inc, 2012, p. 3)
InterActive CorpBecame an incorporated company in 1986IAC is a leading internet company with 50+ brands in 30 countriesIAC brands are in the search, dating, and media sectorsIn Aug 2012 IAC expanded its company and purchased about.com from the new York times.(InterActive Corp, 2012, p. 1)
Risk Factors- ZyngaZynga is mainly dependent onFacebook, if this relationshipEnds Zynga risks are: Lack of distribution, marketing and payment platform (Zynga inc, 2011, p. 7)Zynga generate the majority of revenue and players through Facebook, and has no foreseeable alternatives Zynga is subject to Facebook’s terms and conditions, which governs how promotions, distribution and operating games is executed
Risk Factors- Zynga con’dIts a new and rapidly changing industry, which makes it difficult to evaluate their business and prospects. (Zynga inc, 2011, p. 8)It is a new business model and a short operating history, which makes it difficult to evaluate their prospects and future financial results and may increase the risk that we will not be successful.We rely on a small portion of our total players for nearly all of our revenue. (Zynga inc., 2011 p. 9)
Risk Factors - FacebookIf users do not continue to grow and consistently use Facebook, their revenue level will be unsustainable (Facebook, 2012, p. 12)The majority of Facebook’s revenue is from advertisers and if advertisers reduce spending on Facebook for another venture Facebook’s sustainably will be damaged (Facebook, 2012, p. 13)An increased use of Facebook on a mobile phones will decrease revenue due to the unproven ability to monetize mobile users (Facebook, 2012, p. 14)
Risk Factors- IAC A current risk IAC is experiencing is one stock holder holding 33.8% of share holder votes which gives him great influence on how the business is run (InterActive Corp, 2012, p. 12) High dependence on key personal and the competitive market for retaining new skilled employees IAC depends upon arrangements with Google and any negative changes in their relationship could affect their business, financial condition and results of operations. (InterActive Corp, 2012, p. 14)
Risk Factors- IAC Con’dIAC’s success depends upon the continued growth and acceptance of online advertising, particularly paid listings, as an effective alternative to traditional, offline advertising (InterActive Corp, 2012, p. 13)IAC depends upon arrangements with third parties to drive traffic to various websites and convert visitors into users and customers. (InterActive Corp, 2012, p. 14)Not being able to adapt quickly in a changing society (InterActive Corp, 2012, p. 16)
Risk Factors - GoogleGoogle faces intense competition and if they do not innovate and provide new products and services this will effect revenue and operating results (Google Inc, 2012, p. 10)Continual investment into new business strategies and ventures can disrupt on going business (Google Inc, 2012, p. 11)Google generates the majority of revenue from advertising any reduction in spending or loss of advertisers could seriously harm business. (Google Inc, 2012, p. 12)
Comparison Zynga Facebook ICA GoogleNet Income -$404,316 $205 (mill) $340.7 (mill) $10,737 (mill)per year (thous) 2011 (Facebook, (InterActive (Google Inc, (Zynga inc, 2012, p. 43) Corp, 2012, p. 2012, p. 29) 2011, p. 29) 42)How profit is launch new Facebook has does not No Cashutilized games, and not paid anticipate dividends build the dividends and paying cash have ever been Zynga brand. rolls profit dividends on paid nor will it Never paid into the its common for the dividends and operation of stock or Class foreseeable have no new and old B common future. intention in business stock in CEO is paid the future. (Facebook, the immediate 101 Mill in 2010 (Zynga inc, 2012, p. 37) future. (Google Inc, 2011, p. 24) (InterActive 2012, p. 26) Corp, 2012, p. 24)
Final StatementsIt appears that generally Social media publicly traded companies are all quite innovative and are prospering. (Zynga’s net profits from 4th quarter 2012) In turn with this prosperity each corporation has taken their profits and rolled that back into the company towards advertising or innovation. With each company having similar business models they suffer from similar risks. Social media is not a sustainable industry because the hope for a consistent growth is based on the consistency of a changing society. One day everyone will enjoy and love a site such as MySpace the next day we are over it.
Thank you and I hope you enjoyed my Presentation
BibliographyEdwards, J. (2012, 02 15). Zynga Sees Limits To Growth: Sales Flatten As Marketing Costs Double. Retrieved 02 27, 2012, from Business Insider: http://www.businessinsider.com/zynga-sees- limits-to-growth-sales-flatten-as-marketing-costs-double-2012-2?op=1Facebook. (2012, 05 17). The Prospectus. Retrieved 02 27, 2013, from The Wall Street Journal: http://online.wsj.com/article/SB10001424052702303610504577420330688934066.htmlGoogle Inc. (2012, 12 31). Google Investor Relations. Retrieved 02 26, 2013, from Google: http://www.sec.gov/Archives/edgar/data/1288776/000119312512222158/d320628ddef14a.htmInterActive Corp. (2012). IAC/INTERACTIVECORP Form 10-K. Delaware: Edgar online.Michael, L. (2012, 04 20). Ex-CEO Schmidt gets $101M pay package in new Google job. Retrieved 02 27, 2012, from USA Today: http://usatoday30.usatoday.com/tech/news/story/2012-04-20/eric- schmidt-google-chairman-pay/54446032/1Zynga inc. (2011, 12 31). Zynga Inc Form 10-K Annual report. Retrieved 02 27, 2012, from https://materials.proxyvote.com/Approved/98986T/20120420/AR_126431/
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