Facebook follow Apple: reliance on external developers to reduce development costs

Facebook last year's R & D expenses in total income accounted for only 10%, lower than the Internet companies such as Zynga and LinkedIn recently listed. This seems to follow the example of Apple's approach: to lower the costs, and with external developers to expand the R & D.

Lucrative

As the world's largest social network, Facebook has been the hacker culture is known, and often held a number of programming. But the company is now increasingly encouraging external developers to add functionality for their website cell phone case wholesale .

Facebook will be the IPO (initial public offering). U.S. investment firm BGC Partners analyst Colin Gillis, Colin Gillis, due to lower research and development costs, making Facebook more profitable than the other upcoming IPO enterprises. But the company's challenge is how to deal with the challenge of Google and young start-up companies, in order to maintain the growth rate.

"They have a huge profit when a company is listed, investors usually want to see margin improvement." Gillies said. Facebook's 2011 profit margin of 27%, higher than 19% in 2010 and 2009, 16%, also higher than the S & P 500 index, the average profit margin of 14% cellphone cases wholesale .

Room for growth

EBITDA (before interest, taxes, depreciation and amortization earnings before) calculation, Facebook, last year's margin was 56%. Gillies said, which allows the company is not much room for improvement. Facebook spokesman declined to comment.

Facebook is currently emulate Apple's business model, the latter is the largest enterprise in the global market. While Apple is independently developed a lot of technology, but to attract outside developers and has developed hundreds of applications for the iPhone and iPad. In this way, there is no need to spend too much R & D costs, and still be able to enhance customer loyalty. Apple on a quarter of R & D expenses in total revenue accounted for 1.6%.

"Apple has not any R & D costs of the application developers through their own earnings, but we see the benefits of this innovation. Facebook, the same is true." Dartmouth Business School professor Ron Adelaide satisfied, Ron Adner said.

In the case of Facebook, Zynga, and other developers to play an important role. Zynga Facebook offers a variety of the most popular games, including "FarmVille", "Mafia Wars" and "Words - With Friends".

From website: http://twitter.com/#!/dpgate