FACEBOOK

Facebook Financial Crisis

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Facebook Financial Crisis

Introduction

One of the most popular social networking is Facebook and it is launched in 2004. Facebook has more than 900 million users in 2004. The popularity of Facebook is increasing day by day. Facebook users have to sign up and make personal profile before using Facebook, after that they can add their friends, family member and any others. Facebook. Microsoft publicized that it had acquired a 1.6 percent share of Facebook for $240, and also acquire rights to consign international advertisement on Facebook.

Discussion

It is debatable that if Facebook was asked to close its social networking site temporarily or for permanent shut down. There is no doubt that, it will result in disastrous and terrible consequences of worth 200 million or so monthly users who are active on the site of social networking. The question will arises what users of Facebook will do in that time and where they are going to connect with acquaintances. How could it happen? It is possible mainly because of financial crisis in economy that hits Facebook as well (Levy & Justin, 2006).

Facebook users do not considered the fact that to run a social networking site is very costly process. In reality, US economy is enhanced to about $300 million with the contribution of Facebook in the past year, still that is not enough to run a business. In brief, Facebook is going through a financial crisis as they are unable to make profit, as well as bearing loses. By the year 2008, this financial hit is on its peak.

Thus, a question arise that from where Facebook can raise money. The answer is obvious and simple that is Facebook can generate revenue from advertisement on their site to overcome financial crisis. However, it ...