Monday, March 10, 2014

Tech Talk / By Martha Knight



It is ten years since Mark Zuckerberg and a few other kids at his college put up a website they and others could use to connect (and find hot dates) online. Later they would hang ten, riding a wave of unimaginable size and power, a benign tsunami.

Before Facebook there was Facemash, created by Zuckerberg by hacking the Harvard student ID database, photos and all. Zuckerberg nearly got himself expelled for that caper. Harvard shut the site down promptly.

But that doesn’t count as the birth of Facebook. Zuckerberg and co-founder Dustin Moskovitz sent a new domain, Thefacebook.com, to 300 people the night of February 4, 2004. One day later they had upwards of 1,500 registered users, all at Harvard.

Days later classmates Duvya Narenda and the Winklevoss twins, Tyler and Cameron, claimed they had been involved with Zuckerberg on a similar project, and that Zuckerberg was using their jointly conceived business model and ideas in Thefacebook.com.

The Harvard Crimson set about investigating the claims by Narenda and the Winklevosses, who were running another Harvard-based social network called ConnectU. Zuckerberg is said to have hacked email accounts of two Crimson writers.

In March of 2004 Thefacebook.com expanded access to Stanford, Columbia and Yale.

Five months later Sean Parker became the first president of the fledgling corporation. You remember Parker—autodidact, entrepreneur, co-founder (with Shawn Fanning) of Napster, Plaxo and Spotify. He resigned the following year after being arrested for cocaine possession.

Accel Partners invested $13 billion in Thefacebook in May of 2005. In August the company changed its name to Facebook. In order to do that, it had to buy the domain name from another company for $200,000.

Still in October, Facebook expanded to other colleges in the United Kingdom and in the Latin America, then in Australia and New Zealand. The photo-sharing system was added, so profiles could include their likenesses, and also could upload other photos. Before 2005 was over, users could tag, or identify people in photos they shared.

In 2006 Zuckerberg was said to be willing to let Facebook be acquired by Yahoo for a cool billion. But then Yahoo had some hard times and lowered its offer to a mere $800 million. No way, Zuckerberg said. Later Yahoo upped its offer to a billion again, but Zuckerberg was no longer in the mood to deal.

So long as Facebook was limited to college students, it had a finite market. When Zuckerberg realized that Yahoo and other giants were interested in the Facebook site, he must have become convinced that there was a far larger potential subscriber base out there. So late in 2006 Facebook was opened to anyone 13 or older with a valid email address.

That’s when News Feed was added. It gathered material posted on all the profiles of members of a group, and shared it around on all the homepages of the group. Many users were put off by this, to say the least.

In 2007 Facebook Platform was launched. Third-party developers were invited to provide apps that would run on Facebook. Social gaming! Zynga! FarmVille!

Meanwhile the intellectual property wrangles had continued in the courts. The Winklevoss twins had sued Zuckerberg for $140 million, but settled for $65 million, and Zuckerberg acquired ConnectU. Later the Winklebvosses appealed unsuccessfully.

For a while there was a special site for mobile users, but in 2008 Facebook for iPhone was launched. Facebook reached 100 million users by August of that year, at about four years of age. And all without anyone ever yet having LIKEd anyone else’s likeness, or even a post, on Facebook! But the Like icon and function were added at that point.

The story of the development of Facebook was told in Ben Mezrich’s “The Accidental Billionaires,” published in 2009.

Ads were relegated to sidebar areas until January of 2012, when they became part of the News Feed.

Months later Facebook bought the popular Instagram for $1 billion in stock and cash. Instagram had just expanded to Android, and had 27 million iOS subscribers. It was not subsumed by Facebook, and seems to operate much as before, but is owned and managed by Facebook.

So far Facebook had been privately owned, but how do company owners owners get really, really rich? With an Initial Public Offering, of course. Facebook’s was in May of 2012. It raised $16 billion, about ten times what Google raised in its 2004 IPO.

In September of 2012 Facebook reached 1 billion users.

Just before its tenth birthday Facebook launched Paper, so far just on iOS. It is supposed to provide especially interesting content from other sites, mostly news and entertainment.

This past week Facebook bought WhatsApp for $19 billion. WhatsApp us a cross-platform messaging service used by some 450 members a month. Three days later WhatsApp experienced a shutdown. At their site there was a message saying “Whatsapp Co.: We are currently facing serious service issues with sending and receiving messages. Our service is experiencing a problem right now. Hope to restore the functionality shortly. We will update you as we learn more. Sorry for the downtime.”

WhatsApp is seen as a great service to use as a substitute for text messaging. Unlike texting, it’s free! But, of course, it is useful only if it works. During the outage of about three-and-a-half hours, users tweeted frantically, some speculating that Zuckerberg had bought the company to shut it down.

I have a different theory. The purchase of WhatsApp had received some news attention, but not a lot. The buzz about the outage was far greater. Zuck could not have bought more publicity for love nor money!

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