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This Is How Valuable Facebook’s User Information Really Is

Courtesy of ZeroHedge. View original post here.

In its self-description, Acxiom Corporation says it operates as “a marketing technology and services company” which “provides the data foundation for marketers around the world” and “offers products and services that enable people-based marketing.” In short: Acxiom is a online data broker, however one with a twist: a broker which is intimately linked to the data collected by Facebook on its 2 billion users.

Which is a problem: late on Wednesday, in the aftermath of the ongoing Cambridge Analytica scandal, Facebook announced it would end its “Partner Categories” program, which fed data to firms like Acxiom, and would will no longer let advertisers use information from 3rd party data brokers, again like Acxiom. 

So, on Thursday, Acxiom said that the change in Facebook policy could cost it up to $25 million in profit in fiscal 2019. And, more importantly, it also cost Acxiom up to a third of its market cap, as Acxiom shares fell as much as 34%, the largest drop since 2001, resulting in a value loss of over $600 million earlier in the day.

In other words, this is how valuable Facebook user data really is…

… and that’s for other companies: clearly the value of information on Facebook’s “product” – its user – to Facebook and Zuckerberg is exponentially greater.

Still, there was some confusion William Blair quickly chimed in that the selloff left Acxiom shares at attractive levels for investors, claiming that Acxiom doesn’t collect data from Facebook, although the market begs to differ.

The company hasn’t seen any effect so far on deal-related conversations and no one customer accounts for more than 10 percent of its revenue, Klauber said in a research note.

Finally, Not helping matters, On Thursday Ficus Investment Research came out with an unfavorable rating and price target of $20, implying another 15% downside for the shares, according to Bloomberg. Ficus pointed to Acxiom’s reliance on new products and upselling to drive growth, saying these are difficult to maintain in a competitive environment.


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