Monday, June 28, 2010

Does Facebook Charge?

A lot of people out there are probably thinking about the cool social networking website by Mark Zuckerburg that has pretty much taken over the world.

So what people want to know is Does Facebook Charge any money to use their services?

The answer is NO. Facebook is entirely free and they generate revenue from having ads displayed that fit your demographics and profile information that are charged either on a per click or per impression basis. So if you say that you are a male 35 who likes to snowboard in Colorado than you might see an ad for outdoor world and play it again sports advertising snow boards on your page when you are browsing around facebook.

With over 400 million accounts (note that many users have multiple accounts and pages for their businesses so the 400 million user number that is often quoted is probably off) they are able to currently generate over a billion dollars in expected earnings revenue this year making 2010 the best year ever for the popular social networking website.

Facebook however has a very high over head cost in just it's server fees alone. Which were recently released at over $100 million dollars a year to handle all of the traffic, bandwith, pictures, videos, etc....

With an IPO (initial public offering) of it will instantly make the owner's very wealthy and may open up the possibility of expanding revenues with a model that charges per month or per year. If it was $4.95 a month I am sure that a lot of users would still be willing to pay since the face book addiction is rather large.