2. Case Study: Business Problem Solving
Maria Vega Ryan Lopez Xavier Baquero Nayle Pimentel

4. Summary of Facebook’s Dilemma
Mark Zuckerberg founded
Facebook on 2004.
•Had over 300 million worldwide
users by the fall of 2009.
•Making it the leader in the market
share of social networks ruling
out MySpace and Twitter.
•The dilemma is that maintenance
of the Facebook site is too
expensive.

6. Summary of Facebook’s Dilemma
The attempts to sell online ads on the website has
not been very successful.
•Facebook ads are very cheap compared to other
websites.
•70% of its members are located outside the U.S.,
which makes is less likely for them to make online
purchases.
•Facebook now try to sell the information from their
members, which has created controversy with them

8. Summary of Facebook’s Dilemma
Other ventures Facebook attempt to gain popularity with
the integration of applications.
•Facebook has also launched Facebook Lite, in order to
compete with Twitter.
•Users have been continuously insisting on privacy,
decreasing its valuation from investors.
•Even though Windows bought 1.6% of the company for
$246 million, its valuation has been too volatile.
•Valuation has ranged from $3.7 billion to $10 billion

10. 1. What concepts in this chapter are illustrated in this
case?
Wireless Internet connections grows
rapidly
Powerful handheld devices support
music, Web surfing, and entertainment
The internet broadband foundation
becomes stronger. More than half the
Internet user population join an online
social network
The e-commerce marketplace is too
crowded.

12. 1. What concepts in this chapter are illustrated in this
case?

14. 2. What is the role of E-commerce and Web 2.0
Technologies in Facebook’s widespread popularity?
•Company’s use Facebook to
communicate with potential customers
•The site is a marketing tool.
•Facebook platform is beneficial to the
developers:
• Provides them with a platform for
applications that are fully compatible
with the site.
•The applications make Facebook a
stickier destination for users due to having
the ability to do more of the things they
like to do without having to leave the site

16. 3. Describe the weaknesses of Facebook’s privacy policies and features.
What management, organization, and technology factors
have contributed to those weaknesses?
Their weakness stems from the introduction
of Beacon, the mishandling of News Feed,
and the inefficient methods of deleting an
account.
1)Beacon was a program that shared users'
purchase information with their friends
automatically.
• Beacon was an opt-out program, which
means that if you do not reject it you
automatically accept it.
• This later was turned into an opt-in
program, which is a type of program that
registers you as a user only when you
accept..

18. 3. Describe the weaknesses of
Facebook’s privacy policies and
features.
What management, organization,
and technology factors
have contributed to those
weaknesses?
2)News Feed shares your actions
with everyone on the Facebook
Web.
3) Furthermore it was hard to
delete your account unless users
looked for outside assistance from
watchdog groups.

20. 4. Does Facebook Have a Viable Business Model?
•We think that Facebook does
have a viable business model:
•First of all Facebook is the
largest social network site and
it is still growing.
•It is highly valued today.
•It is an opportunity for
marketers to reach their
demographic target audience.

22. 5. If you were responsible for coordinating Facebook’s advertising, how would
you balance the desire to become increasingly profitable with the need to
protect the privacy of your users?
•The privacy level of Facebook
users is crucial for the well being
of the network, therefore I would
allow privacy controls just like
Facebook does today.
•This allows you to organize your
friends into groups and pages
therefore the user has to accept in
order for you to access their
profile information.