@ SxSW: Keynote: Mark Zuckerberg: More To Facebook Than Valuation, Microsoft

IMG_1112(Update: The video of the session is here online, on Austin-American’s website.) Take a wild guess why that’s a picture of a screen broadcasting Facebook CEO Mark Zuckerberg, rather than the Zuck himself. Apparently there are three or four packed auditoriums packed with the spillover. Frankly, anyone hoping to hear some news was probably left wanting, although Facebook is about to launch in French. A fair point that he made early on was that the Facebook-related stuff the media focuses on is not what they’re so concerned about internally. Eventually, the interview by BW’s Sarah Lacy did cover items like the Microsoft (NSDQ: MSFT) investment and the Beacon error, but much of the conversation was about Zuckerberg’s big vision for how Facebook could be used to change the world. Examples: Political groups agitating for anti-poverty legislation and Columbian Facebook users protesting guerrillas. That example prompted the question: “Did you ever think that people would be using Facebook to revolt against the government of Columbia?” Moving on:

Microsoft deal: “A lot of people have focused on deals we have done, valuations, all these things… building this system that helps people communicate and connect” “Building a business is the most effecitve way.” “We want the way to make money to be in line with how people use the site.” There are commercial ways that people use the site: people list favorite music, movies, etc.” “I think they’re very happy.” Lacy: “Can we call Ballmer?” Zuckerberg: “I don’t have my phone on me.” On internal strife over the deal: “Some people didn’t want to do it… we’ve had some management changes (the best laugh line of the interview).”

Advertising: “When we announced that (its first advertising initiatives), we probably got a little ahead of ourselves. … the theme holds though: what we want to do is build a site where people share information.” Ads will be driven by these behaviors. “That’s the way the best monetization systems work.”

Beacon: Zuckerberg attempted to downplay the significance of the company’s controversial Beacon platform: “In our company, Beacon isn’t even part of the ad team. It’s part of the platform team.” While he acknowledged mistakes at the launch, the basic idea of extending the service beyond the realm of Facebook.com remains a key part of the strategy.

Privacy: “People need to be able to say exactly who they want to share each “Giving people very granular control over who they share with allows connections. Example: people post their cell numbers on Facebook because they know not everyone will see it.

Facebook music? “What’s going on there is we talk to a lot of companies all the time… there are (already) music applications on Facebook.” Basically, because so many developers have done music apps, there’s no hurry in doing music directly. Bottom line: “At this point… we have nothing to talk about right now.”

Personal wealth and Facebook valuation: Zuckerberg was asked about his status as the youngest billionaire in the Forbes list. After an eight-months pregnant pause: “We’re just not that focused on stuff like that.” On the subject of the big Microsoft raise valuing the company at $15 billion, he was pretty straightforward, saying the company wanted the least dilution as possible at the most favorable terms. Few would doubt that they successfully accomplished that. “Having so much focus on money at the business can be tough.” It’s a challenge to avoid people who are just there for the stock options, which is part of the reason it’s in no rush to do an IPO. “Revenue and value of the company are a trailing indicator.”

New COO Sheryl Sandberg: “Someone who can help us scale is going to be very important over the coming years.” Zuckerberg reiterated that the company feels very lucky to have landed her.

Overall: A number of the questions during the interview were set up by long preambles (sometimes referencing the interviewer’s book), which Zuckerberg often responded to with one-word answers. At one point, when explaining why he had so little to say, he sputtered out “You have to ask questions.” This prompted thunderous applause from the audience, both in the main room and in the spillover rooms.(Not editorializing on the quality of the interview; it’s just what happened. Will try to upload a clip of that later.) At the end from Zuckerberg: “I don’t think this has been that painful.”

Update: This instant comic-strip says it all: