NetGuide NZ - The Techday Weekender - Feb 4th 2012

Warning: This story was published more than a year ago.

The Techday Weekender - Feb 4th 2012

All anybody could talk about in the tech world this week was the long-awaited Initial Public Offering (IPO) of social networking giant Facebook.

After days of rumours, the announcement finally came on Thursday, with the company filing an S-1 form with the US Securities & Exchange Commission declaring its intention to go public. The S-1 was soon swamped with viewers, nearly crashing the SEC website, while Facebook also suffered an embarrassing slow-down the day after the announcement.

When people finally managed to view the filing, they found a host of interesting tidbits about how Facebook the company stands, including the fact that its membership is 845 million, and 483 million of those visit every day.

Perhaps more interesting, at least to investors, is the fact the site’s annual revenue was US$3.7 billion last year – or, seen another way, just US$4.39 per active user. That’s a pretty slim return for such a staggering user base, especially considering Apple’s revenue was US$46.3 billion just last quarter.

With membership (arguably) approaching its peak, Facebook's growth potential lies in upping its advertising – but that’s exactly what’s going to drive users to competitors like Google+. Then there’s the possibility that people will just get bored of Facebook, as they did with MySpace.

Regardless, most commentators agree that it's a risky investment, and the only people guaranteed to benefit from the IPO are the insiders (including this graffiti artist who painted murals on the walls at the Facebook office back in 2005 and chose to be paid in shares rather than cash; at the time they were worth a few thousand dollars, but they could soon be worth as much as US$200 million).

In other news, the New Zealand smartphone market is about to get a shake-up, with Nokia announcing that its new Lumia range, running on the Windows Phone OS, will be arriving on our shores next month. Both Telecom and Vodafone will carry the Lumia 800, while the entry-level Lumia 710 will be offered by Telecom only (no word yet on the high-end Lumia 900). Speaking of Telecom, the company also cut its iPhone prices for buyers taking up 24-month contracts this week, most by around $50.

While we're talking retail, Australian firm Woolworths announced it will be closing as many as 100 Dick Smith stores across Australia and New Zealand this year, before looking to sell off the remaining operations. The move prompted condemnation from the store’s namesake, who didn’t like the idea of having his brand under foreign ownership; however, the bigger question raised by the move is whether brick-and-mortar tech retailing even has a future, when so many purchases are now made online.

Finally, dissent brewing over Google’s new privacy policies prompted Microsoft to plug its own everyday tools this week. The company took out full-page ads in USA Today, the Wall Street Journal and the New York Times telling people unhappy with Google that they can always ditch Gmail, Google Search, Google Apps and Chrome and go back to Hotmail, Bing, Office and Internet Explorer. Google responded that the campaign was full of ‘myths’; at any rate, it’s hard to see any self-respecting tech geek rushing back to IE any time soon.

Have a great Waitangi weekend, we’ll see you Tuesday.

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