Facebook is moving to increase the size of its initial public offering by 25 per cent, a source has told Reuters, a move that comes despite increased fears over the social media giant’s longterm revenue potential. General Motors announced plans Tuesday to pull its advertising from the site. But that doesn’t seem to have quelled investor interest in the stock.
Facebook, founded eight years ago by Mark Zuckerberg in a Harvard dorm room, will add about 85 million shares to its IPO, floating about 422 million shares in an offering expected on Friday, the source told Reuters, declining to be identified because the information was confidential.
The expanded size, coupled with Facebook’s recently announced plans to raise the IPO price range, would make Facebook the third-largest initial share sale in U.S. history after Visa Inc and GM. Facebook declined to comment on the increased IPO size, which was first reported by CNBC on Tuesday.
Meanwhile, on Gizmodo, Mat Honan has a long, interesting read on how Yahoo killed Flickr and what lessons that failure holds for other tech giants swallowing startups.
Because Flickr wasn’t as profitable as some of the other bigger properties, like Yahoo Mail or Yahoo Sports, it wasn’t given the resources that were dedicated to other products. That meant it had to spend its resources on integration, rather than innovation. Which made it harder to attract new users, which meant it couldn’t make as much money, which meant (full circle) it didn’t get more resources. And so it goes.
As a result of being resource-starved, Flickr quit planting the anchors it needed to climb ever higher. It missed the boat on local, on real time, on mobile, and even ultimately on social—the field it pioneered. And so, it never became the Flickr of video; YouTube snagged that ring. It never became the Flickr of people, which was of course Facebook. It remained the Flickr of photos. At least, until Instagram came along.
The whole piece is worth reading, but if you want Honan’s view on Yahoo in one sentence, this one probably does it:
If the Internet really were a series of tubes, Yahoo would be the leaking sewage pipe, covering everything it comes in contact with in watered-down shit.