Paul Saffo weighs in on Facebook ahead of IPO
SAN JOSE, Calif. (KGO) -- Early demand for Facebook stock has convinced the company's investors to sell more of their shares, when Facebook goes public on Friday. According to papers filed Wednesday, an additional 84 million shares -- worth up to $3.2 billion -- will go on the market.
Facebook itself won't benefit because the shares are all held by venture capital investors. It will, however, dilute the standing of founder Mark Zuckerberg, who has voting power over some of those shares. He will retain control of 55.8 percent of the stock.
So what does the future hold for Facebook?
Paul Saffo is a technology futurist. In fact, he spent part of the day speaking at Facebook. But he shared his thoughts with ABC7 News first.
Facebook, he says, is not unlike where television was in the 50s. TV sets were initially designed for living rooms. Facebook was created for desktops and laptops. But now it has to scramble to keep up with its users. And it needs revenue from ads. But putting ads on mobile isn't easy.
"Being able to continue their advertising model in the scarce real estate of a small handheld device is very difficult and getting people's attention when they're living their lives and running around with a handheld is difficult," Saffo said. "Typing is very difficult on a handheld device and Facebook is a very typing-centric activity."
Saffo sees an upside and a downside to Facebook's IPO cash infusion. It can afford to snap up small start-ups like Instagram, the photo-sharing app, for $1 billion.
But that means start-ups may not realize their potential.
"Long term, that's a very troubling, very serious issue for Silicon Valley, because if you take away the opportunity for the general public to participate in these companies and to allow these companies to have their own future without being acquired by some other big company, that hurts innovation," he said.
On the other hand, saffo sees an upside as Facebook's newly minted millionaires leave to create start-ups.
"We're going to see a whole bunch of new innovations and a whole bunch of new companies, and perhaps even the Facebook of the future, come out of the people who will be benefitting from this offering," Saffo said.
Saffo also thinks Facebook needs to be bold and re-invent itself constantly.
"Facebook has to be like Apple," Saffo said. "It's got to kill its most successful products by coming out with things that are even better. If it does that, it has a very bright future."
That future begins Friday when Facebook goes public.
facebook, IPO, mark zuckerberg, social media, business, david louie
- Memorial takes place in SF to honor Mandela
- Four-alarm warehouse fire in Concord investigated
- Elevator company cited in death at Levi's Stadium
- Bay Area freeze extends longer than expected
- Bank robbery suspect shot near mall in San Rafael
- NTSB: Asiana captain worried about visual landing
- Amazon grocery delivery rolls into San Francisco 15 min ago
- MLB intends to ban plate collisions 36 min ago
- Spotify launches free mobile streaming service 50 min ago
- IKEA recalls lamp following death of child 25 min ago
- Winter Spare the Air called through Thursday
- abcnews: First lady's glare seen round the world 12 min ago
- roundup: Rollover crash victim; Vallejo homicide
- weather: Bay Area weather forecast for Wednesday