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What Are 'Users' Worth in Valuing Companies? A Lot -- if They Pay Up

Stocks in this article: AAPL AMZN FB KING NFLX TWTR ZNGA

NEW YORK (TheStreet) -- What's a user worth online?

To backtrack -- online companies track their users carefully, referring to them as MAUs. Those are monthly active users, and each is a person who's tried an online site or service and likes it.

Most of the time, MAUs refer to users of apps or websites. They usually don't pay for a service, although sometimes -- most often in the case of gaming companies -- they do.

Usually, a paying user of a service is called a "subscriber." Typically, these types of MAUs pay on a monthly or annual basis.

Facebook (FB), for example, has 1.28 billion MAUs. Its market cap is $156 billion. That's about $122 per user.

However, Facebook also has acquired Instagram and WhatsApp in the past two years. WhatsApp had 450 million MAUs and was bought for $19 billion. That works out to $42 per MAU. Instagram had 20 million MAUs two years ago and was bought for $1 billion. That's about $50 per MAU.

Of course, Instagram has increased its MAUs from 20 million two years ago to 200 million today. That means Facebook only paid $5 per MAU two years ago -- a bargain.

Facebook doesn't tell us how much overlap exists between the MAUs of its different services however. Presumably this is because there is a lot of overlap.

This means that, in total, Facebook probably doesn't have many more than 1.3 billion MAUs. I would guess no more than 1.5 billion.

What about Netflix (NFLX)? The online movie distributor has 44 million subscribers or MAUs. Each streaming subscriber pays roughly $7.99 a month (more internationally); those who receive DVDs in the mail pay more. Netflix's market cap is $21 billion. So each subscriber is worth somewhere around $477.

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