It almost hard to imagine how the internet was before the arrival of social networks just a few years ago. They have shifted the way how people are engaging with the web completely. In the last couple of years or so there was another shift, this time among the social networks themselves- They began making money. A LOT of money.
And above all, stands one social network- Facebook.
I remember that I heard about two years ago that Facebook isn’t profitable yet and I was in shock. How is it possible that a website so popular that its visitors are so engaging is not profitable? But since then, things have changed. Oh, they’ve changed alright…
When Facebook disclosed its earnings this month as part of its IPOing process later on this year, the money making monster has been exposed in full- $3.7 billion in revenue, where more than 85% comes from ads ($3.15 billion). But apparently, this is just the beginning of its monstrous ad revenue growth.
In a recent report by the research firm eMarketer, it is predicted that in 2012 Facebook ad revenue worldwide will climb by 60.5% and will top the $5 billion! In 2013, the ad revenue will jump by additional 32.8% to $6.72 billion and in 2014 it will present a modest climb of 13.7% to $7.64 billion.
Facebook ad revenue ratio between the U.S. and abroad is also pretty healthy. If in 2011 55% of Facebook’s ad revenue came from the U.S. alone, by 2014 it predicted to decline for 49%. Just for comparison, Twitter’s non-U.S. ad revenue is predicted to constitute only as 17% out of the total by 2014 and for LinkedIn its predicted to constitute as 40%.
The growth of Facebook’s ad revenue outperforming the whole social networking industry growth and forecast of continuing doing so in the next few years, which will result an increased domination over the social networking industry.
eMarketer estimates that all social networks combined have earned in 2011 $5.2 billion. It means that Facebook was accountable for about 60.6% of the whole industry ad revenue. In 2012, Facebook will already be responsible for 65.5%, in 2013 it will be responsible for 65.6% and in 2014 it will slightly decline for 64.4% out of the total social networks ad revenue.
Although Google is still the king of the web, Facebook can at least comfort of being the queen of social networks…