Facebook IPO looming, early 2012 debut expected

The biggest social netoworking player valued near $100 billion, users uneasy about coming changes

The social media giant, Facebook, has been flirting with its inevitable IPO for more than a year, and it looks like when it hits, it's going to be a colossal splash.

The market has seen several Internet social sites go public, with rocky but profit-seeking results such as the nice appreciation from LinkedIn, the fair growth of Groupon, though the last few days of trading have not faired as well, and the recent debut of Angie's List.

Now, reports from The Wall Street Journal are estimating the mother of all social sites to belly-up to the public bar between April and June 2012. As Facebook inches closer to IPO, experts in the field are estimating the company value to exceed $100 billion and that it will raise $10 billion from the IPO.

Those figures would place the social networking site as one of the largest offerings ever.

Facebook has remained tight-lipped about when it will go public but the rumor mills are gaining fodder that the announcement and filing with the SEC could come before the close of the year.

While filing for an IPO is not always the route that large companies wish to move toward, Facebook will have to start disclosing its revenue when it crosses the 500 shareholder threshold, set by the SEC, and most suspect that the company will go public upon that benchmark.

With more than 800 million users and a slew of advertisers and developers that pay for access to create applications and services on the site, Facebook has created a business model that many are ready to bet on.

What could change

One of the greatest concerns is that when the company goes public, the priorities of Facebook will shift to please shareholders rather than benefit the company's longrun goals.

The Palo Alto-company has made a great deal of choices that were not popular in the short term, but were widely understood and accepted after serveral months, as the company evolved.

One of the first concerns is that the already advertising-filled platform, will turn into a bombarment of paid ads and promotions.

Currently, the Facebook feed and mobile applications are free of advertisements. This may be one of the first changes that the monetarily-driven shareholders would push to change, regardless of the long-term goals of the social network.

While expectant traders could be waiting, excited, users may be the ones seeing the biggest changes in the early months of Facebook's public debut.

One of my hopes is that the Facebook managment is able to keep its goals attainable and in sight as much as possible.

Facebook is not commenting on the IPO speculation but stopped months ago in its efforts to push the expected date further into the future.

Just a few weeks ago, CEO and Co-founder Mark Zuckerberg told PBS's Charlie Rose that his company was planning an IPO, but hadn't chosen a time just yet.

"We've made this implicit promise to our investors and to our employees that by compensating them with equity and by giving them equity, that at some point we're going to make that equity worth something publicly and liquidly, in a liquid way," Zuckerberg told Rose.

On Monday, Facebook confirmed that it had acquired a social networking software company WhoGlue. The two companies were in litigation two years ago over a patent claim regarding a personal information management system -- the case was closed in 2010 with a positive outcome for WhoGlue.

For this acquisition, Facebook claimed the software from WhoGlue but stated that "the WhoGlue team isn't joining" the company.

WhoGlue's software allows the creation of subgroups within a larger to group to function and share information securely -- which sounds a lot to me like a way to squeeze into a Google+ circles market.

The social media experts I spoke with say it is too soon to tell what Facebook will do -- and when they move it will likely be swift and silent -- but the company will set several records and be the public announcement to celebrate.

If Facebook opens with an offering of $10 billion, it will be the highest debut for an Internet-based company ever and will catch the attention of every social network that will finally get to read the financial nuts and bolts of the greatest success story of the Web 2.0 generation.

Image Sources -- Wired.com and Stockrockandroll.com