Interest, Suspicion Surround Facebook App’s Sale

    October 2, 2007

Some strange stuff occurs on eBay, and in the latest example of this, a Facebook application called “I am Hungry” was auctioned off for over $20,000.  Was this a sign that the app market is red hot or were there shill bids placed in the auction? (As speculated in an article at Valleywag.)

Interest, Suspicion Surround Facebook App's Sale
Interest, Suspicion Surround Facebook App’s Sale

I am Hungry may not be the most useful app imaginable; it simply lets friends notify each other when they feel like going out for food.  A few phone calls would accomplish the same thing (with the added benefit of not making everyone exist through Facebook).  On the other hand, I am Hungry has drawn in an impressive number of users (552 of them are classified as “daily active” at present).

So, about that eBay auction . . .  Valleywag’s Tim Faulkner reports, “The bid crept up from $1,000 to $2,000 over the course of the week.  Bidding then jumped to $3,000, then $15,000, then $20,000 in the last ten hours.  Apparently stupid apps attract stupid users which attract stupid buyers.  Or, more likely, someone had an interest in seeing the application sell for much more than bidders cared to pay — like every cliché auction scene you’ve ever seen.”

Faulkner then continues, “We’re not suggesting, of course, that shilling might have taken place.  Oh, no.  But the developers behind I Am Hungry just happen to have built three other Facebook applications, each with more than 2 million users.  If I Am Hungry is worth $20,000, imagine how much these ones must now be worth, based on the newly set market price.”

It’ll be interesting to see what happens from here – how the market for apps, assuming there is such a thing, responds to these events.  In any event, Dan Peguine, one of I am Hungry’s creators, did not respond to a request for comment.

Edit: In the comments below, Dan says he did not receive the email asking for his comment.