Latest Awards Hurdle for The Social Network: Is Mark Zuckerberg the New Bernie Madoff?
The Social Network's ride to status as Oscar front-runner has been a fairly smooth one -- not even the charges that Aaron Sorkin's script too sexist and/or too fabricated has been able to knock the film off the tracks. But perhaps this will do the trick: Is Mark "Time Magazine Person of the Year" Zuckerberg running his billion dollar company like Bernie Madoff?
Maybe? At least that's basically the theory that blogger Joseph Perla puts forth. He asserts that Facebook is nothing more than a Ponzi Scheme because its ads -- where the company generates much revenue -- are worthless. Writes Perla (via NYO):
Have you ever bought a Facebook ad? I have. I have talked to many, many people who have. We have spent hundreds, many have spent thousands or even more, experimenting with Facebook ads. They are worthless. Nobody ever looks at them, and nobody ever clicks on them. I just talked to someone who was trying to promote a book. He found it cost him over $100 in ads to sell one book. Moreover, as you increase your ad spending, people get used to the ads and just ignore them. So, your already low click-through rate plummets even further.
People go to Facebook to interact with their friends. It is fundamentally different from the ad platform that is Google. People go to Google to find something they need, possibly ready to buy, which a good percentage of the time can in fact be solved by someone's ad. Facebook ads, on the other hand, annoy users. They yield no real value, and thus no profits.
Almost everyone I've talked to who has actually bought Facebook ads knows this. But, not everyone has bought Facebook ads yet. There are still more and more new businesses finding out about Facebook ads. As they grow, even more businesses give their money to experiment in destined failure.
Eventually, though, and this might take a long time, but it is finite, everyone will have tried Facebook ads and know that they are useless. Eventually, after 10 million businesses have invested $1000 each, and Facebook has earned $10 billion in revenue in total, then they will have run out of new customers and their revenue will dry up. A useless product is never sustainable. I wish I could short Facebook.
Interesting argument. The real question, though, is how this will affect The Social Network's award chances! Will Oscar voters want to reward a movie that has
possibly inadvertently not really wound up in the same breath as Public Enemy No. 1 Bernie Madoff? It's not like The King's Speech has been attached to a public figure so reviled and hated. Oh, wait. Carry on!