Monday, May 5, 2014

Facebook relies on an old internet business model

Facebook relies on an old internet business model: display ads. Display ads generally hurt the user experience, and are also not very efficient at producing revenues. 

Facebook, as everyone knows, has a massive automated ad business. Any advertiser can run their own ads in Facebook, in a variety of different ways. It's such a successful business that Facebook now makes about $9 billion a year just from ads.
(People used to complain about the amount of ads shown in Facebook, but as the user base transitions to Facebook's mobile app from the desktop version, those complaints seem to have gone away.)

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