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FACEBOOK
When it comes to social networking, it's wise to put your best face forward.
Online directory Facebook began by connecting
students through social networks at schools, but has since opened its service
to the general public. Users post photos and information about themselves
through online profiles published on Facebook.com. The site was launched in
2005 by undergraduates at Harvard , led by Mark Zuckerberg, as an online version of the Harvard Facebook. (The name comes from books of freshmen's faces,
majors, and hometowns that are distributed to incoming students.) Microsoft
has a deal to be the exclusive provider of advertising to Facebook.
Investors include Paypal co-founder Peter Thiel and Accel Partners.
Like many Internet success stories, Facebook is
facing the issue of whether to remain independent or to become acquired. The
company has reportedly received buyout offers from heavyweights such as
Yahoo!, Microsoft, and Viacom.
GOOGLE
Companies that publish and market books.
INDUSTRY OVERVIEW:
The book publishing industry is facing a quandary similar to the one
currently being sorted out in the music industry. The issue is this: who has
control of the digital rights of a product? The company forcing the issue to
the forefront in book publishing is search engine Google, which has started
downloading books from libraries into digital format for its Google Book
Search service. Google is scanning public domain books and non-copyrighted
materials (such as government documents) as well as copyrighted books. With
copyrighted books, the company is only making available a few pages or small
amounts of data. A group of publishers including Random House and McGraw-Hill
have sued Google, alleging that its plan violates copyright laws. The Authors
Guild has filed a similar lawsuit. Google argues that it has fair use rights
to the copyrighted materials. Taking a pro-active approach to stem off book
piracy, Random House has announced that it would offer an online
"pay-per-page-view" service that it would offer through agreements
with vendors. Authors would be allowed to opt out if desired. Also, Random
House may bring the service in house in the future. HarperCollins has
announced that it would spend some $1 million digitizing its library of books
and then sell the titles over the Web. Sales for US publishers totaled $28.8
billion in 2004, an increase of nearly 4% from the previous year. A majority
of the 25,000 book publishers in the US are smaller operations. The
largest publishing companies, however, account for the majority of revenues.
The blockbuster Harry Potter series, selling more than 300 million books
worldwide, was published by public company Scholastic in the US. The
majority of book publishers, however, are owned by major media conglomerates.
For example, Random House is a subsidiary of German media giant Bertelsmann
and Simon & Schuster is owned by Viacom. Often, these companies take
advantage of the media outlets owned by their parent company in order to
publicize their books, which some critics feel is an unfair advantage,
especially if it goes undisclosed.
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