Facebook's New (Paid) Marketplace
It's going to be a whole lot easier for Facebook's 400 million users to spend money and it'll become remarkably simple for anyone to buy ads on the world's largest social network. Facebook is teaming up with eBay's Pal Pal , and the results could be huge. Facebook's new facility with payment could create the kind of revenue bump that carries the social network to its inevitable IPO sooner rather than later.
The fact that eBay can take payments in 24 currencies around the world will help Facebook's applications and ad revenues grow globally. Considering the fact that 70 percent of Facebook's users live outside the U.S., this facility with just about any currency will be key. This opens the doors for even the smallest foreign companies to buy and target ads. PayPal has 184 million accounts, more than 73 million of them active. That's a huge base of people (including myself) who could on a whim by a Facebook ad for just about anything. The vast majority of Facebook's revenue comes from advertising, and this seems to sure to accelerate that revenue growth.
This new PayPal deal will also be useful for a small but growing service called "Facebook Credits." Facebook users can buy these credits to snap up virtual goods in a dozen and a half popular games like "(Lil) Farm Life" "SocialCalendar" "Restaurant City." Starting in April Facebook will allow users to use PayPal to buy virtual goods within these games. Don't sneer at the virtual goods market: yes, people spend real money on imaginary items. The market for virtual goods is expected to quadruple to $3.6 billion by 2012 in the U.S. alone.
- More; PayPal to become a way to pay for Facebook ads