I am sorry. I don’t get Facebook.
And I did my research. I signed up for an account. I was poked by some friends and poked back. Some people found me and added me as a friend (but I am not sure I wanted to be found…)
I saw some profile pages. Yes, nice. It looks like a lot of blog and websites. Nothing special. Okay, so I can see you, and your friend, and in one case the sister leaves a message for the other sister so they can meet sometime next week. How convenient.
My question is… is this really worth 15 billion dollars?
And maybe it is. I mean, they have a lot of information on a lot of people. And I find hard to believe that people are afraid to post their lives on the Internet (or worried about their privacy) if they so willingly post just about anything on Facebook.
To me the business model always comes back to a basic premise: get a lot of people together in one place, and then sell the advertising. And for what I read, most developers of Facebook applications rely on ad revenue to make a living.
Now, I have seen this many times. It was called back then ICQ, Geocities, MSN, Blogger, MySpace, Xanga, etc. I also remember Lycos, Altavista, and AskJeeves when the search engine boom was high.
And not so long ago it was all about Google. Now it’s Facebook. And hey, this is a free capitalist world. So you made a nice (if rather plain) application that everyone and their mothers love and use, so you can set the price very high. Basic economic axiom: demand and offer, offer and demand.
Now, I am not a visionary. But I am almost sure the bubble will blow some day. If Facebook does the right thing, they will collect cash now, save it in a bank, and haul for the rest of their lives (which I think is why Jerry Yang from Yahoo never worries too much for Google, he has enough money already to last this live and several other reincarnations…) I also foresee some group of developers saying, hey, this is cool. But I bet I can do it much better/nicer/cooler/exciting/cheaper (take your pick and feel free to combine.)
I keep a WordPress blog and a website of my own. And that is already hard enough. I don’t usually have time to update either, and when I do I become a slave of my own device. I think many people will start moving away from Facebook the moment they realize they don’t have time to maintain their new toy and this one. The same way it happened to Geocities a while ago, and the same way it is happening to Xanga (see graph below from Alexa)
Now what is interesting is not my point of view but rather what will happen in, say 201o… Only time will tell. But history is full of similar examples, and history tends to repeat itself in a very discouraging way.