it's not the crime, it's the coverage

[rone]

So Om Malik wrote this thing about what impelled Facebook to buy Instagram.  First off, i can't get past Malik's assertion of "Facebook's achilles heel"[sic] being "mobile photo sharing".  Seriously?  Mobile photo sharing is a hard-driving revenue stream for anyone in this world?  Is there any evidence that this was considered a weakness by anyone at Facebook?  I can lean on my experience and tell you that sharing photos from my Android phone is stone easy to Facebook, because my phone came with the Facebook app installed.  I couldn't've done it on Instagram at all until very recently.  Facebook was worried about Instagram's mobile photo sharing mojo?  I call bullshit.

And calling Instagram "a platform built on emotion"... what the hell is that about?  I wonder if he's an advance Facebook stock share owner, because it sure as hell sounds like he's trying to talk himself into the deal, which is no less than ludicrous.  Who drops $1B, even if most of it is fake money, on an emotion-based platform?  Emotion fades.

Some are comparing it to Google buying YouTube, but others are comparing it to eBay buying Skype.  I think that it's far more likely to be closer to the latter, except worse.  Bottom line: even if, somehow, this turns out to be a good deal for Facebook, it won't be because of them addressing their supposed "Achilles heel", or because of the strength of Instagram's "emotion".

Bonus cluebie: some "business leader" thinks that Twitter "F$($#@ UP in somehow letting Instagram ended up inside of Facebook"[sic], because nothing says "mobile business advisor" than someone playing with ginned-up valuation numbers.

Comments

[thorfinn]

Anything that pulls people out of Facebook.com is competition to Facebook.

I venture to suggest that one of the top three killer features on Facebook for its consumers (i.e., its product) is quick and easy photo sharing, because Facebook is all about social gossip, and gossip is waaaay better with photos.

Instagram is about the only popular thing floating about that does photos as social gossip, so it makes plenty of sense for FB to buy them as a defensive move.

It's still a ridiculous price, but it's perfectly sensible strategy.

FB have absolutely no reason to care about Klout - it's numerical noise for nerds, and therefore irrelevant as far as actually retaining their product is concerned.

(The other two killer FB features are event management and textual gossip i.e. status updates.)

[ronebofh.livejournal.com]

It's only "sensible strategy" if you accept that "Anything that pulls people out of Facebook.com is competition to Facebook," to which i say, "bullfuckingshit." If Facebook believes it, then double that.

It's silly to dismiss Klout as "numerical noise for nerds" and pump up Instagram as "the only popular thing floating about that does photos as social gossip." That's just your bias talking.

If FB's event management and "textual gossip" are "killer features" in anyone's eyes, we are fucking doomed as a society.

[thorfinn]

Facebook's customers are advertisers and Zynga. Their entire rather large revenue stream comes from that. So anything that takes people out of Facebook.com reduces the amount of advertising they can send.

It doesn't seem like particularly difficult logic to follow from there that anything that pulls people off Facebook.com where they serve ads is a problem for Facebook.

As for bias - hey, I'm a nerd. I like nerdy things as much as the next nerd. But nerds aren't even close to a a significant proportion of normal human society, like it or not. We have an awful lot of impact - I'd go so far as to say we actually do a lot of running the modern world, but there really aren't a lot of us.

Normal human society freakin' loves gossip (whether pictorial or textual or just plain old direct in person chats). And most of them don't think in numbers, either.

This isn't something magical relating to humans today, either. you'll find exactly the same complaints going back through human history pretty much everywhere.

[ronebofh.livejournal.com]

It's precisely the fact that you're a nerd that biases you against Klout by calling it "numerical noise". If that were the case, it wouldn't be where it is now. Some VC assclown somewhere thinks that the noise is good enough to merit funding.

There are plenty of things that pull eyes off Facebook, and yet Facebook isn't in a rush to buy them. So that's why i think there's more to their dysfunctional decision than your reasons.

[thorfinn]

I expect the people at Facebook have a pretty damn good idea of what their users are actually using the site for... and photos is massive on there.

What's your idea for the "real rationale" behind their decision? Got anything that doesn't violate occam's razor?

As far as I can see, it's a simple two step logic:

1. photo sharing is a massive heavily used feature for FB's users/product - arguably *the* feature that makes it better than anything else in terms of walled-garden draw. It's their equivalent of "search = google".

2. Instagram was pretty much the only mobile photo sharing site that even comes close to competing with that feature and thus pulling those users off FB. (There are other photo sharing sites, but I cannot think of a single one which managed to get 30 million users whilst not even bothering to do anything except an iPhone client.)

That's all there is to it. Any other explanation seems over complicated to me.

I still think it's a ridiculous price - but on the other hand it's completely undisclosed how much of that price is stock, and quite possibly newly minted stock. It could well be 99% stock, for all we know. FB is a private company right now, and just minting some stock at an arbitrary valuation is essentially a license to print fake money, particularly as they have their shiny upcoming IPO which will turn that stock into something resembling real cash.


As far as what VC assclowns will fund, they fund lots of things. It's gambling, pretty much. Lots of stuff VCs fund just falls over, and lots of stuff succeeds that VCs have gone nowhere near. The successes make them enough money that it's worth keeping on betting. So reading into individual cases of funding is, well, not very useful.

[ronebofh.livejournal.com]

Anyway, the rant isn't so much that Facebook bought Instagram for an outrageous amount because, really, who gives a shit. It's about yet another Internet journalist writer type person who has achieved notoriety despite being a useless and utter boob (Om Malik, Jason Calacanis, Robert Scoble... the list goes on for far too long).

[thorfinn]

Heh. Well, that some of these "pundits" / "journalists" are essentially trolls isn't in doubt. Even the "real" newspapers are pretty much reduced to trolling for hits to sell ads nowadays.