Originally published: April 17, 2012
Last updated: April 19, 2012 - 8:20pm
Facebook's deal for photo-sharing service Instagram and the IPO of advertising network Millennial Media Inc. prove that the smartphone boom can produce billion-dollar valuations for makers of mobile software and services. Now comes the true test: Actually delivering the revenue and profits to back up those numbers. The technology landscape is hitting another inflection point.
Much as the personal computer created a platform for software makers in the 1980s, smartphones and tablets are now setting the table for another big transfer of wealth as new companies arise and dominant PC-based companies struggle to make the shift. Venture capitalists are making huge bets that mobile phones will be the next big tech money-maker. "It is not a toy anymore," said Chris Sacca, a prominent early-stage financier who invested in Instagram. But a major obstacle is stunting growth. Advertising, the revenue source of choice for many Internet upstarts, isn't keeping pace with the explosive growth in the smartphone platform.
- Facebook faces extended US review of Instagram deal
- With Instagram, Facebook Spars With Twitter
- As Facebook Launches a Standalone Camera App, the Instagram Buy Comes Into Focus
- Even Facebook Must Change
- Facebook Instagram deal delay threat
- Facebook, Google Must Adapt as Users Embrace 'Unsocial' Networks
- Instagram beauty contests worry parents, child privacy advocates
- Two consumer groups urge Facebook to back off privacy changes
- Facebook to Acquire Photo-Sharing Start-Up Instagram for $1 Billion
- Instagram seizes and sells your identity
- That $1B for Instagram? It’s 23M Shares of Facebook + $300M in Cash
- Instagram Walks Back Ad Language, but Leaves the Door Open
- In Facebook Deal, Board Was All But Out of Picture
- Why Would the Feds Investigate the Facebook-Instagram Deal?