Can Facebook become Profitable from 2010?

20 million people cannot be wrong! Can they? I am talking about Facebook that has more than 20 million users and it is undoubtedly the number one social networking website in the world. It is way ahead compared to Myspace. With all the media buzz in recent weeks. Twitter still does not have even 15% of the user base. Facebook is 5 years old but the company has not seen any profit until now. It is not unnatural because many new ventures work in that day. First, they just invest and invest and get more and more loyal users and then they start to earn money. Now, there is a sense of optimism in among the top executives in the company that it will become profitable in 2010. In an interview with BBC, one of the top executives of Facebook talked about it.

Well, I am not that much optimistic about the company becoming profitable in 2010. 200 million may sound to be an impressive number but the reality is that a large portion of them come from outside of Europe and America. If you have a blog or website and you get most of your visitors outside of Europe and America then you know that that traffic do not bring a lot of money from the advertisers. This is the main problem of Facebook. They have to spend huge money for bandwidth and web space for the users but they do not get good return on their investment.

The second problem that I find about it is that most people come directly to the website. Visitors come from search engine queries tend to bring more advertisement money for you compared to the visitors who come to your website directly. The basic idea is that the visitors who come directly to your website directly are less likely to click on ads and buy something. However, this theory does not work when a website offers e-commerce services. Think of Amazon or Ebay. People just go there and buy something.

I think that Facebook has the same potential if they focus on e-commerce more. They have the impressive user base and it will be only growing for quite some time. Almost every one I know has an account there except me. I am a bit worried about the privacy policy and even more than that, I am too much busy in my daily life. So, opening an account would become meaningless anyway. Most people are not like me and Facebook has become a part of popular culture. One of the reasons that the company could not become profitable yet is the fact that many people spend a lot of time.

So, Facebook has the user base to earn money. It just needs to focus on finding some good way to make money.