Most of advertising spending is going into Google and Facebook

If data is the new oil, it would be good to have a price yardstick akin to Brent. This is difficult when social media companies offer ostensibly free services… Across the US, digital advertising spending has increased threefold in less than a decade. Most of that money is going into two companies: Google and Facebook. One way to think about the value of user data is to divide company revenue by monthly user numbers to reach the average revenue per user (Arpu). At Facebook, which collects information about users and then sells targeted access, Arpu has doubled in less than five years to more than $23 last year… At Twitter the rise is less pronounced, from $8 two years ago to over $9 last year. Yet Arpu does not take into account the value of data over the longer term. Enterprise value is a better reflection of revenues and profits expected. On this basis, users of visual social media app Pinterest are worth about $60 while each Facebook user is worth about $200 — more than twice as much as they were five years ago… Tech companies would argue that proliferating connections have increased the utility of their networks. Moreover, few users see their attention as having much real monetary value. But if their data is worth more, then the product it buys is due a similar upgrade. The real price of data will be out in the open, sooner or later.
 
Lex.

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