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Comment by rwebb | Hacker News Reader

not a good article. the "ponzi" theory is good, simply because the advertisers pumping $ into the network haven't gotten proven returns (lots of the FB networks that have venture backing are pumping in their own ad inventory and subsidizing their own networks - not sustainable). the whole "evil" thing is laughable though. wtf?

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One of Umair's theories is that traditional industrial-era representations of the firm (i.e. crass commercial corporation) are headed towards irrelevance.

In their stead, firms which leverage the wealth of information/value outside the firm (i.e. GOOG) will create huge value.

GOOG leverages information outside the firm...and that info stays outside the firm (at least as far as search is concerned). This is generally referred to as "edge competency."

IN CONTRAST, facebook sucks information in from the outside world, and keeps it inside the firm.

Ergo, it is "evil."

He is right, in that this is not a sustainable strategy.

I got what he's trying to say. The second I read about the fbFund I knew the ulterior reason wasn't to help out the apps makers, it was $10MM dollars to insure that Facebook can sell out for the highest possible valuation as they can.

Why does Facebook have to subsidize other apps? If the platform is as good and full of opportunities as they say it is, no one would need the extra carrot on the stick.

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