Just days before its highly-anticipated initial public offering, social networking giant Facebook has received a very public slap in the face from car giant General Motors: it has told Facebook that it will no longer advertise with it because the ads just don't work.

The loss of $10m in ad revenue is not likely to dent Facebook's market value, which is on course to sale past the $100bn mark when it floats. Last year Facebook made $3.7bn in revenue.

But the public rebuke over the effectiveness of advertising on the social network will undoubtedly sting.

According to the Wall Street Journal, which first reported GM's shift in advertising strategy, the car giant spends around $40m each year on Facebook – three-quarters going on social content and $10m on advertising.

The implication is clear: Facebook's a great avenue for businesses to connect with their customers, but spending money on adverts is simply over-egging it.

And GM is not alone in questioning the value of Facebook advertising.

According to research by online ad analysts WordStream, Facebook ads generate far fewer click-throughs than those placed with arch-rival Google. WordStream claimed the average click-through rate on Google display ads is 0.4 per cent; with Facebook it's just 0.05 per cent.

Such measures matter little when Facebook can generate rampant demand for its stock ahead of its IPO. But as a public company, it will be beholden to shareholders that demand revenues grow – so expect to see Facebook double down on its ad offerings in the very near future.

LAS VEGAS: IBM kicked off its Impact conference in Vegas on Monday in a rather unusual way. Out was the corporate video, showing a corny round-up of all the firm’s achievements over the past 12 months followed by a stilted executive speech; in was a talk by Walter Isaacson, chairman of policy studies organisation the Aspen Institute, and more famously known as Steve Jobs’ biographer, on the lessons Jobs' legacy can teach on innovation and creativity.

Isaacson introduced his subject with a typical example of Jobs’ humility.

“Steve called me after I’d done my books on [Benjamin] Franklin and [Albert] Einstein and said ‘Why don’t you do me next?’, Isaacson said. However, Isaacson went on to explain that this was a fair comparison based on the passion and creativity these individuals had.

One of the anecdotes Isaacson gave about Jobs was back when the Apple former chief executive was a child and was helping his father build a fence. Jobs’ father said to him they had to make the back of the fence just as beautiful as the front. When Jobs questioned this, pointing out that nobody would ever see the back, his dad responded: ‘You will know’. Jobs said this was one of the most important lessons of his life.

Isaacson also told delegates that Jobs’ favourite phrase was, ‘Don't be afraid, you can do it’, which he’d use to encourage anyone from Steve Wozniak to Corning’s chief executive to do what he wanted them to do – in this case, speed up some coding or design Gorilla Glass respectively - and meet his exacting standards.

The passion that Jobs had for his products was matched by that of Einstein, Isaacson said.

“For Einstein, it started at about age seven, when his father gave him a compass. Einstein marvelled that nothing was touching the needle, but it kept twitching,” Isaacson explained.

“[In response to the rule that] time marches along second by second, irrespective of how we observe it, Einstein said, ‘How do we know?’ He came up with the idea that time is relevant as he thought different.”

Jobs and Einstein were also similar in continuing to think differently on their deathbeds.

Einstein was still trying to figure out a unified field theory days before his death, working out why the compass needle twitched and pointed North. During the process of writing his biography, Isaacson said he went to view the six or seven pages Einstein wrote about this: “He wrote line after line of maths equation, even when he was dying in hospital. Eventually the hand writing gets shaky and dribbles off.”

Jobs was similarly driven to the end. Isaacson said that last summer, when it became clear that Jobs was having real trouble in his battle with cancer, he talked about the legacy of great products and worried over whether 100 years from now, Apple would still be seen as an innovator, as a handful of firms like IBM and Disney have managed to do.

Isaacson asked Jobs at the time whether he still felt spiritual.

“Yeah I like to believe that there’s something more to what we do here,” Jobs said.

“But then sometimes when I’m depressed, I think maybe death is like an on/off switch, click and you’re gone. Maybe that’s why I didn’t like big on/off switches on Apple devices.”

Isaacson finished by reminding the Impact audience that the lesson of any great innovator is “you’re part of something bigger. Every single one of the people I wrote about, they felt they were part of something bigger.”

The next project for Isaacson is a book about computing history, and he noted that the IBM name keeps cropping up. No doubt Jobs and his legacy at Apple will feature heavily also.

Best Buy chief executive Brain Dunn has abruptly resigned amid poor sales and an internal personal conduct probe. Dunn had held the position since 2009.

"I have enjoyed every one of my 28 years with this company, and I leave it today in position for a strong future. I am proud of my fellow employees and I wish them the best," said Dunn.

The company in 2010 began its move into the UK market, but has since fallen on tough times.

Despite store closings and employee layoffs the brick and mortar retailer insists that the separation had nothing to do with the companies economic woes.

"There were no disagreements between Mr. Dunn and the company on any matter relating to operations, financial controls, policies or procedures." the company indicated in a statement.

Instead the issue seems to be the formers CEO’s personal conduct that led to his downfall. As an internal probe into Dunn’s personal conduct uncovered by the Wall Street Journal led him to resign instead of see the completion of said probe.

"Certain issues were brought to the board’s attention regarding Mr. Dunn’s personal conduct, unrelated to the company’s operations or financial controls, and an audit committee investigation was initiated," said Best Buy spokeswoman Claire Koeneman "Prior to the completion of the investigation, Mr. Dunn chose to resign."

While the exact reason behind the personal probe is still unknown, one thing is for certain: Dunn was trying to move the company into the digital age. With online stores like Amazon and Overstock taking a foothold in the consumer electronics market it was Dunn who tried to move the brick and mortar store into a smaller more internet based agenda.

“We intend to strengthen our portfolio of store formats and footprints – closing some big box stores, modifying others to our enhanced Connected Store format, and adding Best Buy Mobile stand-alone locations,” Dunn said prior to his resignation.

But it appears to have been too little too late for the former CEO. Now it will be someone else’s responsibility to usher Best Buy into the digital age.

LAS VEGAS: Those of you who were hoping that Microsoft would leave CES with one last spectacular fizzle are in for bad news.

Steve Ballmer's 2012 keynote has come and gone without any power outages, system crashes or video delays. Despite an over-capacity crowd at CES, Microsoft was able to showcase its latest and greatest products with very little in the way of negative attention.

The final Microsoft keynote for the forseeable future highlighted many of the company's flagship brands, including the growing Windows Phone platform, XBox and its Kinnect platform, and the upcoming Windows 8 OS for both desktop and tablet systems.

Ballmer, aided by co-host Ryan Seacrest, was his usual dynamic self to the very end. When asked what was next, he emphatically declared "Metro, Metro Metro!" in reference to the highly-touted Windows 8 interface.

"Together, all of us in this industry, in thousands of new ways, will use the software and services and devices to invent incredible things," he said.

"Metro will drive the new magic across all user experiences."

And with that, Microsoft ends its days of headlining CES. Those of you feeling nostalgic about the whole thing will always have the memories of the company's historic keynote fails to keep you company.

SAN FRANCISCO: It's the end of day one at Oracle OpenWorld, and there's been a few highlights so far, namely the Big Data Appliance running on a NoSQL database, and the prospect of high level business intelligence tools via Exalytics. And depending on your sports preference, the appearance on stage of San Francisco Giants president Larry Baer giving Oracle chief Larry Ellison a World Series ring on Sunday evening.

However, the keynote sessions so far have not been that inspiring. Ellison used his Sunday night slot to drill down into some very technical detail on the Exa- line of products, punctuated only by his usual instruction to the PowerPoint manager of "next slide".

His comments about Oracle being the Apple of the enterprise world, IN that both firms marry hardware and software, were interesting, as was his promise to go after IBM in the server processor arena. But it was not a very uplifting session for the opening of a show that has attracted around 45,000 people to the Moscone Center.

On Monday morning, the prospect of Oracle president Mark Hurd was more enticing, as we waited to see whether the ex-HP chief would use his slot to carry on the slanging war between the two firms, or at least have a minor dig at his previous employer.

Although this didn't come to fruition, Hurd did promise to give an Oracle strategy update, which he then failed to deliver. Aside from the mention of Oracle's $4bn+ R&D spend per year, a 20 per cent increase in licences and the fact that 2012 will be all about the Exa- products, Hurd had little else to say. 

EMC must have been thrilled to steal Oracle's thunder at the show, with chief executive Joe Tucci and president Pat Gelsinger taking to the OpenWorld stage to tout the beta release of the firm's Project Lightning flash cards.

On Tuesday we have the prospect of Michael Dell and Oracle's John Fowler sharing a keynote slot. We'll keep you posted on whether Oracle livens up for day two of the show.

In what will undoubtedly be seen as yet another sign of the shifting global economic sands, China has topped the US in terms of quarterly PC sales for the first time, according to the latest stats from IDC.

The analyst firm recorded shipments of 18.5 million units in the People's Republic in the second quarter of 2011, compared to 17.7 million units in the US. The US is expected to end the year on top thanks to strong festive sales, but China will triumph in 2012 and, given its inexorable growth, for years to come.

IDC predicted that China will ship 85.2 million units compared to the US figure of 76.6 million in 2012, or a market share of 21.8 per cent versus 19.6 per cent.

"China's lead in the PC market is a huge shift that reflects the rising fortunes of emerging markets as well as the relative stagnation of more mature regions," said Loren Loverde, programme vice president at IDC's Worldwide PC Tracker.

"While the immediate economic circumstances in the US and other markets had a significant impact on the timing of China's move into the lead, they have not changed the trend, but accelerated it."

The stats come after a tough few months for the US and eurozone economies. The sovereign debt crisis in Europe is showing no signs of abating, while the US had its AAA credit rating downgraded for the first time in its history, as politicians foolishly turned the economy into a points scoring exercise and failed effectively to address the underlying problems.

It's not a massive overstatement, then, to say that the People's Republic of China has finally taken up its position as the preeminent global economic powerhouse.

This will mean different things for different businesses in different sectors, of course. However, across the board it should reinforce the notion among those who haven't done so already that a Chinese outpost is now a necessity, not a nice-to-have.

Aside from providing a neat little snapshot into the growing wealth of a nation whose economic potential has still not been realised, the growing number of PC users in China will have the pound signs flashing in the eyes of tech entrepreneurs everywhere.

Jeff Kim, COO of CDNetworks, a firm which helps content providers expand their presence in the region, was naturally optimistic of the opportunities that lay behind the IDC figures.

"This is clear evidence that China's growing middle class, already known for its strong consumerism, is also highly computer and internet literate," he told us.

"We see the trend continuing as evidenced by the recent high growth in the amount of web site and application content that we serve to Chinese internet users on behalf of our content provider customers."

The big name vendors have certainly wasted no time. Apple is reportedly building a cheaper version of its iPhone for emerging markets such as China, while Nokia chose Hong Kong on Wednesday as the venue to launch three Symbian Belle-based phones, which it hopes will make a big impact on these markets and help turn around its fortunes.

For those interested in tapping the vast Chinese market, however, there are still big barriers, and businesses would do well to keep their eyes fully open before taking the plunge, as we've highlighted before on Frontline. Hong Kong and Singapore, for example, can provide a useful hub and stepping stone from which to eventually expand operations into China.

However, firms that continue to procrastinate in expanding their bases into Asia and eventually China, in industries from publishing and accounting to finance and technology, will be left behind as their more agile and forward thinking competitors speed past. And rightly so.

RIM's woes have continued after the smartphone maker lost a senior product manager to major rival Samsung.

Ryan Biden, formerly a senior product manager for the BlackBerry PlayBook, defected to the Korean manufacturer, where he is now director of product marketing.

He is the second high-level executive to leave RIM in the past month, following Brian Wallace, who was vice president of digital media and is now vice president of strategic marketing at Samsung.

Biden's last official act was to help launch the PlayBook, which debuted to a mixed reception. The device was plagued by problems on release, and RIM had to embarrassingly admit that it had shipped 1,000 faulty models. However, the tablet appears to be back on track as RIM shipped 500,000 devices in the most recent quarter.

Still, RIM has been struggling with numerous problems over the past 12 months. The firm received scathing criticism from Morgan Stanley for ineffective R&D ahead of its financial results, which were below par.

The firm's shares plunged by 15 per cent in mid-June after it announced that profits were down $74m year on year.

Dissent within the RIM ranks was also confirmed by an anonymous high-level employee, who published an open letter outlining faults in the current management.

Among the criticisms were a poor management structure, a lack of focus on developers, and an accusation that the company is carrying too much dead wood.

Social networking firm Facebook has gathered journalists at its Palo Alto headquarters today for a major announcement rumoured to be a tie up with Skype.

Founder Mark Zuckerberg set the rumour mill into overdrive last week when he revealed that the firm would announce something "awesome" on Wednesday.

Some have guessed that it could be the launch of a dedicated iPad application, but it is more likely that Zuckerberg will announce some kind of deal with Skype which could give Facebook users the ability to make VoIP calls from the site.

The event is set to kick off in the next few minutes and we will be live blogging here:

0947 The world's press is currently camped out in the Facebook parking lot waiting to get into the event - good thing Silicon Valley is sunny today. It's looking like the start will be delayed until 1015, news that has The Wall Street Journal and others freaking out. Never travel without a wireless hotspot.

1005 We're in the building at least. Currently hanging out in the canteen waiting for the show to kick off. Hoping Skype will be here for questions, it could be a very interesting Q&A.

1015 Zuck takes the stage. This event starts the 2011 launch season, lots of fun stuff to announce in next weeks and months.

1017 Social networking at inflection point. For past five years talk has been around connecting people. That's interesting, but until recently there was an open question whether social networking would be mass-market. That chapter is done, he said.

1019 Past five years have been about user growth. Next five years will be about social applications. The leading companies are developing for social selling. No-one measures internet success in user numbers, so why should it for social networking?

1021 Sharing is exploding. People are sharing twice what they were last year, and will double sharing annually. It's not just a Facebook phenomenon; it's across the whole internet.

1022 Facebook now at 750 million users, but numbers aren't important. Moore's Law applies to sharing, so Facebook is looking ahead.

1028 Whole host of sharing apps coming up this year, with three today. First off, group chat in Groups that can be started on the fly. Secondly a new chat design, and finally the expected video calling.

1031 Video chat developed with Skype. No need to download Skype to use it, can download software in 10 seconds when calling via Facebook. No group video calls. Zuckerberg says Facebook will focus on the infrastructure and let third parties develop the apps. "Independent entrepreneurs will always be better than a company trying to do a million things." A not so subtle dig at Google.

1036 Video demo. There's a single click on the chat box and it fires up the video. Quality looks good, excellent frame rate but you'd expect that for a demo. Certainly looks smooth - hope I can block people.

1041 Tony Bates, chief executive of Skype, on stage. At peak times video calling accounts for majority of Skype traffic, and now averaging 300 million minutes a day. Skype has done the PC and mobile, now moving to social. May add paid services later.

1043 Zuckerberg wrapping up. Expect a lot more like this over the next few months and years. Now onto the Q&A.

1045 The inevitable question on Google+. He's ducked it. Well, he would wouldn't he.

1048 Skype getting questions on how this helps the company. Bates says they want a billion users, and this grows their services.

1053 Network load should not be too heavy. Skype app is a mini-client embedded in Facebook, and shouldn't overload the network. Zuckerberg says Facebook will build more datacentres.

1054 Facebook has a really good relationship with Microsoft. Having Skype owned by Microsoft gives stability for the future and makes it easy to partner. We've worked with Microsoft on Bing and host of other issues, says Zuckerberg.  

1058 It's all about sharing, Zuckerberg concludes. Applications are the biggest driver for this, then mobile and Groups very much last. The new changes should alter that, one supposes. Now off to try to get the questions answered that weren't covered. Signing off, and a full report on the news page coming soon.