More than 83 million Facebook users are fake

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   Stacie Lposted 12 years ago

   Helen A.S. Popkin
   Facebook: More than 83 million users are fake
   NBC
   
   People with multiple Facebook accounts, profiles for pets,zombie blondes.  These are a few examples of the 83.09 million fake users Facebook revealed this week as part of the social network's first public quarterly earnings report. 
   Facebook further breaks down its fake users like this:
   
       4.8 percent are duplicate accounts (a single user with two or more accounts, in violation of Facebook's terms of service).
       2.4 percent are user-misclassified accounts, in which users have created personal profiles for a business, organization, or non-human entity such as a pet (instead of a Page, which such entities are allowed under Facebook's terms of service).
       1.5 percent are undesirable accounts, which represent user profiles that Facebook determines are intended to be used for purposes that violate our terms of service, such as spamming.
   
   http://www.technolog.msnbc.msn.com/tech … ake-919873
   Would this be fraud for investors who thought there were more real people and businesses using the site?

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      kirstenblogposted 12 years agoin reply to this

      In my view only if FB was somehow in control of how many people are 'real'. I suppose a case could be made if it could be proved that FB had known its high number of fakes and had hidden that info from investors. If this is new info to FB then how could have have done anything before now to inform investors?

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      molometerposted 12 years agoin reply to this

      The people that brought the IPO would have been aware of this glaring over estimation. Facebook would also be aware, that all those pet profiles were 'fake' too.
      The greedy people that bought into the hype, have had their fingers burnt. Hooray!
      Is it any wonder that $10, billion was wiped off the share price recently. Someone knew this and dumped their shares.
      The obvious thing to do is to have an inquiry, and jail those responsible for this apparently blatant fraud.

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   paradigmsearchposted 12 years ago

   My dog has been careful to only make intelligent, well-thought-out posts. He was highly perturbed when he read that FB considers him a fake. He is thinking of bringing legal action.

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      molometerposted 12 years agoin reply to this

      Maybe we could get all the dogs together and file a class action for defamation? : )

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   Kangaroo_Jaseposted 12 years ago

   I reckon the figure is much more than 83 million IMHO

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      molometerposted 12 years agoin reply to this

      And you would be right.

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   jacharlessposted 12 years ago

   It would not be considered fraud, because each email address is considered an individual or account {user}. Like Hub Pages, which has 175,112 published users {an average 7 hubs per} yet has over 300,000 registered accounts. This is just one example. Millions of websites have multiple user accounts -especially Gmail, G+, social bookmarking sites, etc.
   
   What matters to the investor is the revenue potential from product delivery -in FB case, ads.
   
   James.

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      molometerposted 12 years agoin reply to this

      This is the interesting aspect of these 'revelations'.  Of course they must have gone through the data with a fine tooth comb. Due diligence would demand that.
      So why all the fuss over these so called fake accounts, and subsequent $10 billion wiped of the value of Facebook, less than a month after the IPO?
      Who sold, why and when, would be good questions to be answered.

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         jacharlessposted 12 years agoin reply to this

         That is easy to answer.
         The Lock-Up period for FB just ended, so the remaining major FB Shareholders can now legally sell their shares. These are considered to be the original shareholders of the public stock. Some include Goldman Sachs, JPM, etc. At launch, the owners sold off their private stock and gave it to the public.
         
         The public response to the FB share price was not as anticipated, hence the beginning of the end. If not for the Reserved Shares holding up the stock price, as seen the first month, the drop would have been massive. Its effect on Zynga, its games partner, alone caused a huge stir in the tech sector, as it pulled several companies tied to it down as well. Shareholders realized the projection of the valuation was not as appeared, neither was public interest/response to the stock. FB should have soared to $73. It barely made $43.
         
         I followed the trend for 90 days could nothing else but laugh at the panic of the bankers/brokers and the mile-high stack of lawsuits on the most anticipated public offering ever. The volume of SELL -especially when Options kicked in- was/is just ridiculous. Nobody wants to keep this stock. Like a 3rd world country everyone talks about, but no one wants to move there, or bailout.
         
         
         
         What was the problem? User accounts? The Revenue Modal? The best answer is the valuation itself. The valuation was not determined by the volume of user accounts but more-so determined by the ad display ratio for a logged in user. For example, an average LIU [logged in user] will visit upwards of five friend pages, the main feed [wall] and their profile per session. The average log by a user are about five times per day -some more, some less. So, the relevant ad displays would be five (5) ads per load, seven pages per LIU, equating to 35 ad displays per session, at 5 sessions per LIU/day is 175 displays. Even if only ten millions users -most of which are not US based, ironically- logged in per day, it would equate to 1.75 billion displays per day. But, FB knows users are active nearly every day at the same ratios. So, 1.75 billion displays is around 640 billion ad displays annual. In essence, each LIU has an ad display volume of about 65,000 ad views each per year. The value of that is determined as any PPC would be, ranging from $0.10 - $1.00. We'll go middle of the road for a mere US quarter or $0.25.
         
         Putting numbers to the above brings us to the valuation issue.
         Each LIU has an annual ad value of nearly $20,000. Twenty grand per person is a whole lot of money! Compare that to the median spendable income of a typical LIU, which is about 2,000 annual or 10% of the projected FB per account value. Again, applying just 10 million LIU, brings in 200 billion in potential ad revenue. This put FB over the mark of 100 billion in valuation. Now, consider 500 million LIU, the number goes to 20 Trillion. Crazy how twenty-five cents can be worth so much in the big schema?
         
         And there is more to this, that cannot be explained here. The above is just the tip of the proverbial iceberg. One example is your information now filtered into Bing Social Search, because you have an FB account. Even if you are not active on a ghost account or a primary account, the numbers do not change for the Revenue Modal.
         
         Now, I think the share price dropped below $19 on Friday setting off a series of very deep rooted problems for the now public company. Its protections/safeguards are gone. Zynga et al have pulled away leaving her to tread water. Unfortunately, the 900 million accounts -450M LIU realistically have no interest in investing. Unless FB rolls out the red carpet of new products before the fourth quarter, the price is going to reach Penny Stock level and then dissolution...
         
         Big Z should have stayed true to the hacker philosophy of it not being about the money, but about creating a very fun inter-connecting platform.
         
         James.

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   ptosisposted 12 years ago

   Duh, when I friended Grigori Yefimovich Rasputin who died in 1916 - i think that was a clue. BTW: I have 2 accounts but can't get into the other one for years because I never had a stuffed toy and therefore wouldn't know it's name. (question to regain access).
   
   I only use FB to sign on to make comments on various news posts - seen only by me. All info has been deleted (but I'm sure FB still has the info somewhere in 'the cloud'.
   
   
   

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      molometerposted 12 years agoin reply to this

      Doesn't surprise me in the least. Governments always spy on their subjects. Always have, always will. Facebook just makes it easier.

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   sparksterposted 12 years ago

   It wouldn't surprise me if such webmasters (not accusing anyone here by the way) have taken up the practise of intentionally creating fake accounts just so it looks like they've got more users.

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      molometerposted 12 years agoin reply to this

      Someone has admitted that in these very comments. How weird. Who has the time?

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   awareposted 12 years ago

   yeah . state the obvious.

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      molometerposted 12 years agoin reply to this

      Helpful comments are always welcome lol

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   livewithrichardposted 12 years ago

   I don't think there is any fraud involved.  I know many people that have Safe for Work and Safe for Home Facebook accounts.  Some employers require that their employees grant them access to their Facebook accounts... for which I think is an invasion of privacy.  Who would want their employer stalking their friends activity?
   
   I'm sure there is a small fraction of users that create multiple accounts so that they can spam other members but savvy investors will look at the revenue and management rather than membership numbers.

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      molometerposted 12 years agoin reply to this

      You make some good points. Apparently here in the UK employers demand to see Facebook accounts. That is a violation of privacy I agree. What right have they to see your personal life?

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   paradigmsearchposted 12 years ago

   The lockout period ended. Thus the mass selling. There were suddenly a whole bunch of people who could now get their bigger homes and spiffier cars.

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    iantoPFposted 12 years ago

    I have a very active facebook account that I thouroughly enjoy. I originally started it with the intention of keeping in touch with my relatives in the US and the UK. To that end it has worked very well but in the course of my activities I now follow "God" and a cabbage patch doll. I find it hard to believe that no one knew there are fake and multiple accounts on FB it's so glaringly obvious.
    What happened with the shares has nothing to do with user accounts and everything to do with bad management. The initial share offering was priced way too high. The shares were never worth what they were being sold for and the market has simply normalized them to their true value. Much to the chagrin of the investors who did not do their due diligence, including those who should have known better.

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    howlermunkeyposted 12 years ago

    Although they have data on 83 million fake accounts (which they themselves investigated and released immediately after Q2 reports and another stock loss???..... timing???) , the accounts still only account for less than ten percent. And come on, anyone who has spent time on facebook cannot be shocked by these numbers, we've all seen the obvious fake accounts, I actually thought the total would be (is?) higher.
    
    As far as the company's position right now, Facebook has timed events badly imho. Investors are sour about the high ipo valuation, zynga is being pushed out the door (which is hard to understand, since the games gave facebook an edge and tons of players inside facebook for hours on end), and they released these fake account numbers right now? its as if they want the stock to slide. The lockup opens up now and goes until December...
    
    That stock is not going to be good in 2013 either, as with the high P/E already, and as we just saw with the Q2 reports, its gonna take more than just beating the numbers, they will have to consistently beat expectations and "wow" wall street. All in the while Zynga is flirting with Amazon's social gaming venture, and has its own gaming site as well.
    
    I wrote about this particular subject. I think facebook was at its best when it was wide open and zynga was full throttle. (IMHO) they should've never changed a thing, gave zynga whatever they wanted, and taken the stock public in 2010.
    
    AND THEN, there's google+, which owns "authorship", which we all know  is HUGE. And the "+" system......
    2013 is gonna be interesting

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       jacharlessposted 12 years agoin reply to this

       I agree, Zynga would be no less than insane to deny an Amazon buy out or acquisition, especially after the harsh treatment it received from FB. Gaming is the largest online activity for both web and mobile platforms. Back in the day it was Yahoo games rooms, with chat and audio, if anyone remembers it.
       
       James.

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