Facebook could soon be worth $200B so forget $100B

For all the naysaying about Facebook, that it's a flash in the pan and such, there are very few that say that "social" is going away.

Facebook has defined the social era of computing--and the companies that defined the previous eras of computing each command market values of $200 billion or more.
Facebook should get there, too.
IBM kicked off the mainframe era of computing and to this day is the leader in big enterprise computers and services. Microsoft was an early leader in personal computer software and now dominates microprocessor based desktops and servers. And after joining the scrum at the tail end of the dotcom boom of the 1990s, Google emerged as the leader of the Internet era of computing, amassing huge market share and most of Internet advertising's profits.
Coincidentally, those three companies--each of which dominated an era of computing--are now each worth roughly $200 billion.

While many still think of Apple as a computer company, it's not. It's reinvented itself as the leader of the mobile era of computing. Three quarters of Apple's revenues are now from the iPhone, iPad, and iPod, and it is in the process of re-creating the Mac as a mobile computer with the MacBook Air. Apple, as the leader of the mobile era of computing, is now valued at an astounding $400 billion plus.
Given the history of IBM, Microsoft, Google, and Apple, that each respectively led the mainframe/minicomputer, personal computer, Internet, and mobile eras of computing, it is not that much of a stretch that Facebook, as the company that defines the social era of computing, will be right up there with them. Each of these eras have produced prodigious revenue and earnings, and as Facebook's S1 filing shows, social is already well on its way to stellar revenue and earnings--making the bulk of its money the way Google does, through advertising.
The leaders of each era have managed to lock in a generation of users ranging from business datacenters, PC operating systems and applications, and the portal by which people search. Facebook's social graph will be just as persistent. While other niche social networks will emerge, most of us aren't going to switch.
Of course, Facebook's current revenue and earnings does not justify such a valuation, but Facebook is still young and doubtless will figure out plenty of ways to make more money, including selling valuable new ad units such as sponsored stories against its increasing number of mobile users. So long as it it continues on its existing trajectory, the leader of the social era of computing will join others in the $200 billion club.
Or--dare I suggest?--the $400 billion club.

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Adobe gives Photoshop CS6 which is a new graphics-chip boost

Adobe Systems has released a second sneak peak of Photoshop CS6 that shows new work to give a hardware boost to the image-editing software.
The graphics processing unit (GPU) speeds the Liquify tool, which lets people smear images in a finger-painting way, according to a Zorana Gee, a Photoshop product manager. She demonstrated the change in a YouTube video, the second in what looks to be a series of previews of the software. An earlier Photoshop CS6 preview showed new raw image editing tools adopted from the Lightroom 4 beta, a darker user interface, and improvements to brush size selection. Expect Adobe to add more previews but to withhold some goodies for the official launch sometime later in the first half of 2012.
When firing up the Liquify plug-in with the current Photoshop CS5.x to edit a 100MB image, the image arrives only gradually, broken up into multiple tiles. "And further, if I want to increase my brush size beyond 1,500 pixels, I can't," Gee said. Worse, when she tries to use the brush, there's a big lag between her stroke and the on-screen result.
In CS6, she said, the image opens immediately in the Liquify filter, the brush size goes beyond 14,000 pixels, and interactive performance is snappy.
"You can see real-time editing--no lag," Gee said. "Your edits immediately follow your cursor."
It's not clear if the GPU help applies to other new tools. Adobe has added other GPU acceleration to assorted features in earlier versions of Photoshop.

Another feature is background save, which lets you do other work while you save a large file, though apparently you can't work on the file itself as it saves.
Photoshop is one of the most popular programs from the San Jose, Calif.-based company, but Adobe is in the midst of a transition to a $600-per-year subscription called the Creative Cloud that combines Photoshop with all the other Creative Suite programs, the Touch mobile apps, and online services for publishing and connecting socially to other subscribers. Cheaper subscriptions and traditional perpetual licenses also will be available for those who want individual packages.
Adobe had wanted to add the GPU acceleration and background save features to Photoshop for some time, but programmers had been derailed by the need to move from Apple's older Carbon user interface to its newer Cocoa interface after Apple canceled its plans for 64-bit Carbon support, said John Nack, an Adobe principal product manager.
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Facebook deserve its astronomical valuation or not?

A day after Facebook opened its books to support its $5 billion IPO, there is still some debate over whether the social network lives up to its astronomical valuation.
In its filing with the Securities and Exchange Commission yesterday, Facebook revealed that it had 845 million monthly users and was rapidly closing in on 1 billion. As many have noted, the key will be leveraging that massive user base to generate more revenue through its display ads and its app platform.
However, some have suggested the historic offering is overblown, characterizing Facebook as a "badly overpriced photo-sharing and gaming site."
Besides making a lot of people rich, Tech Republic's Jason Hiner makes the case that while Facebook's photo sharing is nice, it's not very lucrative. And that while gaming is "very lucrative," it's also "faddish," and Facebook's stake is dependent on third parties such as Farmville creator Zynga. (Twelve percent of its revenue comes from Zynga.)
But Bill Gurley of Benchmark Capital sees promise in the IPO (Benchmark Capital has a minority position in the social network as a result of the acquisition of FriendFeed) and has created a report card of sorts to explain why he believes the company belongs in the "10x forward price/revenue multiple club." Gurley grades Facebook based on 10 metrics that investors consider when deciding whether a company deserves a high valuation.

According to Gurley, the company registers an outstanding score for sustainable competitive advantage and presence of network effects. ("All current non-U.S. Facebook users have immediate connections if they log in," he points out.)
He also gives Facebook high marks for customer lock-in, saying that "leaving Facebook is possible, but finding an alternative with all your friends on it is not really possible." Some fans of Google+ might disagree with him, along with his assertion that the "inclusion of Timeline works to increase this even more by creating a permanent dependence on past content."
Facebook falls short on marginal profitability calculation, noting that its peak profitability was in the fourth quarter of 2010 and that spending has kept pace with revenue growth since then. "Top line" growth is also a sore spot for Facebook; while it had a growth rate of 88 percent for 2011, its fourth-quarter rate was 55 percent.
"If growth rate hurts the company, then it's a direct result of waiting too long to go public--past peak growth," Gurley said.

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