background image
As we introduce new products, as our existing products evolve, or as other companies introduce new
products and services, we may become subject to additional competition.
Technology
We have assembled a team of highly skilled engineers and computer scientists whose expertise spans a
broad range of technical areas. We make significant investments in product and feature development, data
management and personalization technologies, large-scale systems and scalable infrastructure, mobile
technologies, and advertising technologies, including:
·
Product and Feature Development. We aim to improve our existing products continuously and to
develop new products for our users, developers, and marketers. Our product development philosophy is
centered on continuous innovation in creating products that are social by design, which means that our
products are designed to place people and their social interactions at the core of the product experience.
·
Data Management and Personalization Technologies. To provide each user with a personalized
Facebook experience, we must process and analyze a vast and growing amount of content shared by
our users, developers, and marketers and surface the most relevant content in real time. As such, we
invest extensively in developing technologies and analytics in areas including content optimization and
delivery, graph query, media storage and serving, large-scale data management, and software
performance.
·
Large-Scale Systems and Scalable Infrastructure. Our products are built on a shared computing
infrastructure. We use a combination of off-the-shelf and custom software running on clusters of
commodity computers to amass substantial computing capability. Our infrastructure has enabled the
storage and processing of large datasets and facilitated the deployment of our products on a global
scale. As our user base grows, and the level of engagement and sharing from our users continues to
increase, our computing needs continue to expand. We aim to provide our products rapidly and reliably
to all users around the world, including in countries where we do not expect significant short-term
monetization. As the number of international users increases we are investing in extending our
infrastructure to be closer to our users wherever they are in the world. We are currently building our
first major custom international datacenter presence in Lulea, Sweden, which is expected to be
operational in the first half of 2013.
·
Mobile Technologies. In order to providing a high-quality experience on a wide variety of mobile
devices and operating systems, we invest in developing novel techniques and technologies including:
custom graphics rendering, operating system customizations, development tools, systems for
customizing the user experience based on a variety of factors, and systems for monitoring the behavior
of the applications in the field.
·
Advertising Technologies. We invest extensively in advertising technology capable of serving billions
of ad impressions every day while maximizing the relevance of each impression to selected users based
upon the information that users have chosen to share. Our system manages our entire set of ads, the
selected audiences, and the marketers' bids to determine which ads to show each person and how to
display them for every page on Facebook. We use an advanced click prediction system that weighs
many real-time updated features using automated learning techniques. Our technology incorporates the
estimated click-through rate with both the marketer's bid and a user relevancy signal to select the
optimal ads to show.
Our research and development expenses were $1.4 billion, $388 million and $144 million in 2012, 2011,
and 2010, respectively. For information about our research and development expenses, see Part II, Item 7,
"Management's Discussion and Analysis of Financial Condition and Results of Operations ­ Results of
Operations ­ Research and development" of this Annual Report on Form 10-K.
12