3. Facebook, Inc. (Meta)
Revenues 2020: $ 85.695 billion (€ 75.030 billion)
With 2.85 billion monthly active users (as of 31 March 2021), more people have a Facebook account than the combined total populations of China and India. Founded in 2004 by Harvard student Marc Zuckerberg, Facebook has long been more than a tool to upload photos, send status updates or chat with friends. Following rapid expansion, the group controls numerous other communication channels, has invested massively in virtual reality technology and revolutionised the way media content is consumed via the internet.
At the end of October 2021, the news: "Mark Zuckerberg is distancing himself from himself." (FAZ) He "renames his company and chooses the less loaded "Meta" as the new name."
1 Hacker Way
Menlo Park, California 94025
Telephone: 001 650 5434800
Branches of trade: Social networks, messenger services
Legal type: Public company
Financial year: 01.01. – 31.12.
|Revenue (US$ m)||80,695||70,697||55,838||40,653||27,638||17,928||12,466|
|Net income |
|Share price (US$, year end)||273.16||208.67||131.09||177.92||115.04||104.66||78.02|
Executives and Directors
- Mark Zuckerberg, Founder & Chief Executive Officer
- Sheryl Sandberg, Chief Operating Officer
- Dave Wehner, Chief Financial Officer
- Mike Schroepfer, Chief Technology Officer
- Chris Cox, Chief Product Officer
- David Fischer, Chief Revenue Officer
- Jennifer Newstead, General Counsel
Board of Directors:
- Marc Zuckerberg, Facebook
- Sheryl Sandberg, Facebook
- Peggy Alford, PayPal Holdings
- Marc L. Andreessen, Andreessen Horowitz
- Drew Houston, Dropbox, Inc.
- Nancy Killefer, McKinsey & Co.
- Robert M. Kimmitt, Wilmer Cutler Pickering Hale and Dorr LLP
- Peter A. Thiel, Founders Fund, Clarium Capital Management, LLC.
- Tracey T. Travis, The Estée Lauder Companies, Inc.
In October 2003, Harvard student Mark Zuckerberg gained access to the university server and was able to post thousands of student photos on a homepage called "Facemash". The idea was to rate the people in the pictures (over 20,000) according to their "attractiveness". After just a few hours, the page had around 500 visitors. Although the data theft was discovered and Zuckerberg had to apologise to his fellow students, the experiment showed how much potential there was in such an online directory. In February 2004, the prototype called Thefacebook.com went online exclusively for Harvard students. It took less than two weeks for two-thirds of the student body to register. Zuckerberg hired fellow students Dustin Moskovitz, Chris Hughes and Eduardo Saverin to help him develop more applications and features for the site. Gradually, more universities got their own Facebook network. First it was Stanford and Yale; three months later, 30 universities already had a Facebook community.
Sean Parker, co-founder of the music exchange Napster, put them in touch with Peter Thiel, president of Clarium Capital, who was the first investor to invest 500,000 US dollars in venture capital. The Facebook team decided to take a leave of absence from university, like role model Bill Gates, in order to concentrate on the development of Facebook. From then on, things went fast: in November 2004, the millionth user registered and in May 2005, the young company received another financial injection of 13 million US dollars from the venture capital firm Accel Partners. Zuckerberg hired more internet engineers (including Steve Chen, who would later cause a sensation with the video portal YouTube). By the end of 2005, Facebook had five million users. The number increased further when the site was opened to high school students and a photo function was integrated.
In September 2006, all barriers to entry came down. This led to a surge in membership, which was greeted with scepticism by the original, student users. The first uprising in the community occurred when new features called "News Feed" and "Mini Feed" were added to Facebook users' profiles. All of a sudden, all Facebook-internal activities and changes of friends and acquaintances appeared on every user profile in the form of short news items. The users' anger was so great that 700,000 people joined the group "Students Against Facebook News Feed". Zuckerberg admitted mistakes and promised to better protect privacy in the future. Critical voices were also raised by data protectionists. Facebook operators were accused of irresponsible handling of personal information. Media reports about prosecutions and arrests of American teenagers who posed on Facebook with alcohol and drugs increased. Universities and companies banned the use of Facebook, e.g. because teachers or supervisors would be defamed.
In November 2007, Zuckerberg further tested the limits of user tolerance when he introduced a new feature called "Beacon": a marketing tool that informed a user's friends as soon as they bought a product from a manufacturer that had partnered with Facebook via Facebook. The anti-beacon movement of Facebook users and data protectionists criticised that the ad programme had been launched without the users' consent. Two weeks after the launch, a modified version appeared. The reason for this was not so much the protests of non-governmental organisations, but the unrest that had arisen due to the negative publicity on the part of the Beacon partner companies.
By the end of 2008, Facebook had 145 million members. In 2010, David Fincher's film "The Social Network" came out, a Hollywood portrait of the company's founder Zuckerberg that highlighted Facebook's growing status in society. By the end of 2010, there were 500 million Facebook members. In 2012, the IPO. Especially because Facebook could not find an effective way to monetise the growing mobile use of its services, the share price initially fluctuated alarmingly. The issue price on 18 May 2012 was 38 US dollars; four months later, the share had lost almost 50 percent of its value. Although it had already bought rival social network Instagram for $737 million and reported one billion users in September 2012, it was only with the development of the Android interface Facebook Home and especially after the spectacular takeover of messaging service WhatsApp (for $19 billion in February 2014) that Facebook was able to expand its influence on smartphone screens. Which ensured a steady rise in the share price. To this end, Facebook entered the consumer electronics market with the purchase of virtual reality company Oculus (also in 2014). The Oculus Rift VR goggles, launched in 2016, were primarily aimed at PC gamers.
However, in its bid to recruit the next billion Facebook users in emerging and developing countries, the company suffered a defeat in 2016. The Indian government refused to approve Facebook's Free Basics service (previously Internet.org). The official goal was to connect the remaining two-thirds of the world's population without internet access to the internet. Critics accused the campaign of being nothing more than a neo-colonial scheme disguised as a charity that violated net neutrality principles in order to obtain the lucrative personal data of millions of users.
Criticism of Facebook for patchy data protection, abuse of market position, fake news and propaganda became an ongoing issue. After the 2016 US election, Facebook was accused of influencing the election campaign in Trump's favour. As early as 2015, Facebook's increasing importance as a news channel was documented by the Reuters Institute in Oxford. According to the study, 23 percent of 1,969 respondents of all age groups in Germany received their news via their Facebook timeline. In the USA, the corresponding figure was 41 percent of 23,557 respondents. In May 2016, Facebook's growing power to influence opinion was an issue in the US Congress for the first time. The reason for this was a report in the technology blog Gizmodo, according to which the corporation is said to have systematically censored news and opinion articles with a "conservative stance" and removed them from the News Feed. It was not algorithms based on popularity that determined what made it to the users' "front page", but - as in a traditional newspaper editorial office - political preferences of the Facebook employees in charge. Certain topics were supposedly actively brought into the News Feed for political reasons. By 2017, there were two billion users worldwide.
Another dark side of social media came to light in 2018 with the documentary "The Cleaners": it was about so-called cleaners who rated photos and videos on Facebook in Manila, who were supposed to clean Facebook of "spawns of human abysses". Quote Timothy Garton Ash about Facebook: "The biggest cesspool in human history". Or: "Facebook Is Terrible Not Because It's Evil, But Because It's Terrible", as Forbes headlined in January 2018.
In general, 2018 was supposed to be "the worst year in Facebook's history" (Handelsblatt, 20.1.2019), with the scandal surrounding the British data analysis company Cambridge Analytica. The Canadian whistleblower Christopher Wylie, then working at Cambridge Analytica, revealed the illegal use of data from up to 87 million Facebook users in March 2018. Data that was then used to influence potential voters via so-called microtargeting in the 2016 US election campaign - in favour of Donald Trump. However, the data collectors are unlikely to have decided the election, as the head of the British data protection authority ICO Elizabeth Denham said at the end of 2020. There was also a lot of hot air in the Cambridge Analytica story. Facebook still had to pay: 500,000 pounds fine in the UK and five billion dollars fine in the US. In the summer of 2018 came the crash of Facebook shares, from around 210 US dollars on 16 July to 125 dollars on 17 December.
Then Facebook said it would hire editors for its own news section from autumn 2019. So there was to be no more automatic news selection, but "fewer than ten veteran journalists" (according to the New York Times) selecting articles for Facebook. And Mark Zuckerberg, the Facebook boss and guru, as editor-in-chief, would have a say in what news over two billion people read every day. So much for Facebook's transformation from a pure technology company to a media corporation.
Facebook's live video feature could transform the social network into a kind of online TV station in the long run. Facebook already pays media such as the New York Times or Vox.com to produce video content for Live Video. The company also wants to pay celebrities to use the video app. CEO Zuckerberg has reportedly made video streaming a top priority, partly, of course, to compete with the live video offensives of Twitter and Snapchat.
Facebook founder and CEO Marc Zuckerberg (born 1984 in White Plains, New York) began working with codes and programming languages at the age of eleven. His first project was a computer version of the board game "Risk", which the college dropout with knowledge of Latin and ancient Greek set in the time of the Roman Empire. In 2004 he founded Facebook, and in 2010 he was named "Person of the Year" by Time Magazine. Often dubbed "the next Bill Gates" for his combination of success and nerd image, Zuckerberg had a total net worth of $111 billion as of September 2020.
Former Google executive Sheryl Sandberg (born 1969 in Washington, D.C.) has been in charge of day-to-day operations (COO) since 2008 and is responsible for advertising strategy, personnel decisions and lobbying. While Zuckerberg looks after the technical side and the company's external image, it was Sheryl Sandberg who turned a $56 million loss-making business (2008) into an $18.5 billion profit machine (2019), partly by positioning Facebook as a platform for small business advertising. In 2020, Sandberg was ranked 13th among "America's Richest Self-Made Women" (Forbes) with a fortune of 1.8 billion dollars and is considered a representative of a new American women's movement. In 2015, her book "Lean In: Women, Work, and the Will to Lead" was also published in German.
The social network, or rather the mother of all social networks, reached around 2.85 billion users in the first quarter of 2021, who logged on to mobile phones and PCs every month. A core area here, so far only in the USA, is the News Feed, which presents users with individualised articles and advertising based on algorithms. In the USA, for example, the "Washington Post", the financial service Bloomberg, the "Los Angeles Times", the "Wall Street Journal" and CBS News cooperate with Facebook. These publishers are then paid for their content to be available on Facebook News. Facebook News is also to be introduced in Germany (as well as in Great Britain, France, India and Brazil) in the course of 2021. The Facebook ads section is called Facebook Ads, a system that allows companies to target the appropriate audience on Facebook.
Thanks in part to Instagram, the Oxford English Dictionary chose "selfie" as the word of the year in 2013. The social network developed by Kevin Systrom and Mike Krieger, which has belonged to Facebook since 2012 (purchase price: approx. $737 million) and is mainly used for sharing photos and short videos, now has around one billion active users worldwide, and over 21 million in Germany (as of 2020). Around 60 million photos and videos are uploaded every day.
The instant messaging service for text, image, video and sound messages, founded in 2009 in Santa Clara, California, by Jan Koum and Brian Acton. Acquired by Facebook in 2014 for 19 billion dollars, since 2015 "the world's most popular messaging application" with 2 billion users (as of 2020).
Facebook Messenger is a messaging application to send texts, pictures, music and videos. Voice and video telephony are also possible. Originally released as Facebook Chat in 2008, Facebook Messenger was the second most frequently loaded mobile app between 2011 and 2019, with 1.3 billion users in 2020.
The Facebook subsidiary Oculus (founded in 2012, bought in 2014 for 2.3 billion US dollars), which develops and sells VR headsets, apps and games; the B2B platform Workplace for internal communication; "video-calling devices" developed under the Portal brand.
Facebook now has more followers worldwide than Christianity or Islam. The comparison of religions or sects is obvious - for example, when Facebook makes a promise of salvation for the 21st century with its slogan for "an open and connected world". In view of its immense size, there are therefore increasing calls for the tech giant to be broken up. Roger McNamee, a long-time Zuckerberg supporter, was the first in March 2019, Facebook co-founder Chris Hughes followed suit in May, calling for the spin-off of Instagram and WhatsApp; Democratic presidential candidate Elizabeth Warren also spoke out in favour of an unbundling. Then, in early October 2020, the members of the Subcommittee on Competition in the US House of Representatives published a 449-page report. For more than a year, they had investigated the four big tech companies Google, Amazon, Facebook and Apple and found that they were once again dealing with monopolists like in the days of the oil barons and railway magnates, with overpowering platforms with a gatekeeper position that, in the final analysis, had to be threatened with being broken up.
Critics accuse Facebook of gradually taking over its users completely by diversifying its services, whether recently with the flirting portal "Facebook Dating" launched in October 2020 or soon with the dollar-based cryptocurrency called "Diem", which will probably only be launched in the near future. "Diem", initially probably only in the USA. The most important component of the expansion strategy, however, is the virtual reality division. Within the framework of a 10-year plan presented in 2021, the Oculus technology will ultimately be used for nothing less than "teleportation": The headsets, which are currently still used almost exclusively for games, should eventually allow visits to the virtual living rooms of all Facebook users, controlled via direct tracking of the central nervous system and powered by artificial intelligence. Such a VR network would make travel obsolete and, according to Facebook founder Zuckerberg, would be a blessing for society and the environment.
Then at the end of October 2021, as mentioned, Mark Zuckerberg gave his company a new name. "Meta" is the name of the umbrella group under which platforms such as Facebook, WhatsApp and Instagram are now gathered. "Meta" or the so-called "Metaverse": a virtual world that people can access via different devices. "A lot of this is going to be mainstream in five to 10 years", Zuckerberg said, referring to the possibilities in terms of everyday work, gaming and fitness. The need to commute to work could then be eliminated.
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