Facebook

Facebook is the latest high profile company to make a base for itself in the city of Hyderabad in south India

A number of large internet corporations already have a presence in the city, including Google and Microsoft, who make use of the lower costs in India when employing programmers and customer service staff.

Facebook is currently one of the most visited websites on the internet and around 8million of its 400million users are based in India. The largest user base is in the US, but around 70 per cent of users are from elsewhere.

The Hyderabad office joins Palo Alto and Austin in the States and Dublin in Ireland as a centre of Facebook operations. The company’s director of global online operations, Don Faul, says this is vital so that a service can be offered 24 hours a day to serve all the time zones of the world.

The initial team that will be employed in Hyderabad will be relatively small, but fairly rapid expansion is envisaged. Facebook now makes enough money to cover its running costs and has achieved this well ahead of schedule, paving the way for further growth.

According to calculations by SharesPost Inc., an internet trading platform, the social networking company Facebook Inc. has the potential to reach a total value of approximately $11.5 billion (around 7.2 billion GBP). This figure far surpasses the predicted figures for any of Facebook’s rivals, such as MySpace and Twitter Inc.

Although SharePost have warned that their estimations - published in their Venture-Backed Index – are intended to be a ‘reference point’ only, the result of their calculations for Facebook seems to be in line with figures previously estimated for the company. Microsoft estimated Facebook’s value at $15 billion when they bought a 1.6 per cent stake in the company back in 2007, and Digital Sky Technologies valued the company at approximately $10 billion when making a similar shares purchase of 1.96 per cent just last year.

SharesPost, who tracked the values of seven other companies in their Index, also came up with good news for the micro-blogging site Twitter. This other popular social networking company came an impressive third in the list - after the consistently well-performing MySpace – with an estimated future value of $1.33 billion.

Ads on social networking sites Facebook and Twitter are set to be regulated by the Advertising Stands Authority, and stricter rules on how companies use profiles on the sites to advertise are also likely to come into play.

The proposals would see social networking sites regulated in the same way as other forms of advertising, such as television commercials.
Although the new plans have not yet been approved, it is obvious that there is wide support for the changes. Chief Operating Officer at the Advertising Association explained:

“The industry has delivered a clear mandate that first and foremost will protect consumers and children [and] that will also protect editorial content.”

Nick Stringer, from the Internet Advertising Bureau also welcomed the move, and added:

“This is a significant step for both advertising and the internet.”

The non broadcasting advertising code is currently being revamped, in order to address the major changes in that social networking sites in particular have brought about.

If the proposals are given the go-ahead, it is likely that they will come into effect towards the end of the year.

More and more people are using social networking websites and every increasing numbers of those who do are accessing them from mobile phones.

A recent study carried ou by ComScore reveals that 4.7m people accessed Twitter via their mobile in January of this year. This represents a whopping 347 per cent increase on the same period last year. The story is similar with Facebook, which can boast a 112 per cent increase to 25.1m mobile users in January.

The study also showed that 11.1 per cent of people who owned a mobile had accessed a social networking site with it. 30.8 per cent of them used a smartphone to do so.

ComScore’s senior vice president of mobile, Mark Donovan, said:

“Social media is a natural sweet spot for mobile since mobile devices are at the centre of how people communicate with their circle of friends, whether by phone, text, email, or, increasingly, accessing social networking sites via a mobile browser.”

Even more strikingly, these results exclude those who access such sites through mobile applications rather than their mobile browser. It is thought that around 6m people access social networking in this way.

The constant development of the Facebook format looks set to continue as the company plans to introduce a new application called Buxter, which will allow users to send small amounts of money to each other via the social networking site.

Users’ Facebook profiles will be linked with Buxter accounts, allowing them to send payments of no more than £45 to their Facebook friends only. Transactions are free to make, but are subject to a 1.9% commission fee if users want to move the money into a standard bank account.

The Buxter application was designed by ‘safe and simple online payment’ company ClickandBuy, and currently allows transactions in US dollars or Euros. Sterling transactions are set to be launched in the next month or so.

ClickandBuy’s senior VP, Christian von Hammel-Bonten, says he intends the Buxter application to be used on Facebook by friends wanting to share expenses for cinema, concert or theatre tickets, the price of a shared meal or any other small loans. He made it clear that the application is not designed to operate in a similar way to a national bank; it is purely intended to enhance the social networking experience by allowing friends to share money.