Key quote:
<i>"This is not about the revenue streams Facebook has; it’s about the revenue streams they’re about to have."</i><p>Everyone who's been defending Facebook's $33B valuation is projecting the success of some yet-to-be-developed or nascent product at Facebook. Projecting growth based on past earnings and current growth rate is one thing. But imagining hypothetical revenue streams of yet-to-be validated products is batshit crazy. It doesn't matter how obvious or inevitable people think it may be or what the trends are. There's no track record with any of these if-they-wanted-to-they-could-do-this-tomorrow-and-make-billions products.<p><i>"Facebook Credits are poised to be this generation’s American Express"</i><p>Am I the only one that thinks Facebook isn't as omnipotent and in total control of its user-base as people like to think? Everyone is making these projections about users just falling inline with Facebook's potential revenue models, but they forget the shitstorm that was Beacon. Clearly, Beacon was a direct grab at a sustainable business model and it violated many of their user's trust. Facebook may act like its a benevolent dictatorship, but there's always been an element of democratic decision-making at the behest of angry users. And those concessions always occur at the boundary between potential profitability and privacy.<p>So many are quick to use Google as a benchmark when Google itself was an extraordinary circumstance. It was recently mentioned that Larry and Sergey were willing to part with their company for $750,000.[1] Now, you could argue if Bill Gross never existed, Google would never have be Google because they wouldn't have developed Adwords and have a perpetual license to Overture patents. And Google's advertising is its flagship product, accounting for 97% of its revenue.[2]<p>Google was a net win for the internet. It helped structure and organize the majority of information available on the net, and combined the best interest of their users (accurate, quality search) with the best interest of businesses (targeted advertising, purchasing intent). They unlocked tremendous wealth on a new platform and reaped the rewards.<p>Facebook has clearly had a social impact. Just like text-messaging and AOL Instant Messenger did. But the question of if it has unlocked any huge wealth the way Google has is yet to be seen.<p>[1] <a href="http://www.sec.gov/Archives/edgar/data/1288776/000119312509150129/dex992.htm" rel="nofollow">http://www.sec.gov/Archives/edgar/data/1288776/0001193125091...</a>
[2] <a href="http://tech.fortune.cnn.com/2010/09/29/excite-passed-up-buying-google-for-750000-in-1999/" rel="nofollow">http://tech.fortune.cnn.com/2010/09/29/excite-passed-up-buyi...</a>
this is the same crap we used to hear about myspace and friendster.<p>Techcrunch needs to lay off the crack...facebook might be a billion dollar company...it might even be a 2 billion dollar company...but there is no way it'd beat Google.<p>They compare it to Google revenues...but Google's ad product is a lot more effective. On Google the user is searching for widget, and Google tells them "hey widgets are 90% off at this site". With Facebook you are reading your friend's profile, and Facebook tells you "hey, I know you are busy, but this might possibly be of interest to you"<p>The rate of return is a lot worse with Facebook, because you can only target by demographics...not intent
But I don't use Facebook. I work in a department of seven, and they all are extremely reluctant to even check their Facebook accounts. Google? We use it all day. Google is like Linux, you can't even count how much you use it until you actually talk to an engineer.<p>Facebook just reminds me of ICQ. It was all hot shit, everyone thought it was going to take over the world, but it was just left to little old ladys who LOL'd at everything you had to say. Which, according to schedule and my wife's age, is probably going to be about another 10 years. Facebook gets another 10 years before it's ICQ.
Facebook may become bigger than google, but they'll never be more important than google.<p>If facebook would suffer a 1 month outage it would be a 'meh' event, nothing you couldn't live without. If google would be down for as much as 24 hours it would seriously impact a very large number of people and businesses.
Towards the end, the article inadvertently hints at how Facebook may actually collapse: a death of a thousand papercuts from more focused sites that include social features. However, this may come about in two different forms.<p>One way is akin to the "wheel of reincarnation" effect where social features centralize, then fragment, and then centralize again. One can easily see this in the lifecycles of most online discussion venues - a focused start, and then a gradual change and dilution of the site's character that hits a tipping point at some critical moment. Facebook has already gone far, far away from the "college facebook replacement" angle it started with, but it hasn't yet hit the landmine that might cause its own self-destruction.<p>The other way is the emergence of a dominant open system that is pound-for-pound similar in purpose and usability, and simple enough to run that it becomes a commodity. This can take eons of "internet time" to happen. Desktop Linux remains a work-in-progress(but one getting closer and closer to its competition), and Jabber, as a pure instant messaging platform, is still just one of many systems. So if a standard emerges for social networks(and we haven't <i>really</i> settled on one) it will still probably take decades.
Here is another argument for Facebook: hiring potential.<p>Right now, Facebook is the most attractive large tech company in the world. Out of 10 new geniuses 8 will go to Facebook, one to Google, one to Apple. Facebook is smaller (you can get a bigger project immediately), at Facebook your commits go live at the second day on the job ("Move fast and break things"), Facebook options are much more attractive, and also working for Facebook can get you laid (seriously, working there has much more sex appeal than working at other tech companies).<p>Because Facebook can snap the cream of the next generation of talent, it will be in ideal position to take on any big opportunity over the next 5 years.
Let me just say from experience that Facebook ads haven't really generated the same type of return as Google ads. The thing about Google ads is that they are really good at capturing demand that is already out there, like for instance in a niche market where people are looking for a particular product or service (example, search "bike" and get advertisements for bikes of different types, etc.)<p>What I find is that money spent on Google is money spent on trying to get infront of people "who know what they're looking for." With FB, it's sort of the other way around, where you have all these people you can get infront of, but the demand is more opaque, and you're really searching for it instead of capturing established channels like with Google search terms.<p>All of this is really just chatter, only FB can know how to monetize FB, because they have the data, they have the information required to make a decision on what to do, and chances are, like with Google (remember in the early days they had no business model), they'll figure it out through just sheer luck or chance. What's amazing is that they have gotten this far already.
Facebook’s 2015 revenues will be >$28 billion —Adam Rifkin, TechCrunch: <a href="http://predictionbook.com/predictions/1821" rel="nofollow">http://predictionbook.com/predictions/1821</a><p>Did Rifkin make any other specific predictions? I thought about including each source of revenue as a prediction but wasn't sure whether those predictions were anywhere near as interesting/important as the overall sum.
So this article assumes Google is going to stay flat the next 5 years at 28 billion? Facebook has a lot of catching up to do, but Google isn't planning to sit on its thumbs AFAIK.<p>As a company, Google is way more important than Facebook. Facebook connects people, something that isn't difficult to do in ten other ways with 100s of different services. Google on the other hand seems to be really trying to change the world. Much like the Virgin Group.<p>Once the Facebook IPO happens, they would have more than enough cash to do anything they want. Which I hope is more inline with these other companies. Going outside their comfort zone and into entirely different industries to use their wealth and resources to make a more impactful difference.
When was the last time anyone here used facebook to get something done and I really mean get something done and create something of value? Anyone? As long as facebook caters to teen type activities like gossip and displays of vanity it can not compete with google in any serious way. The best it can do in the long run is become a glorified dating site where your friends recommend and vote on your dates and that is all.
Scary perspective. Once Facebook becomes the social layer in every application out there, they will become too powerful. And I don't think Diaspora is the solution (in its present form).<p>By the way, why isn't OpenSocial, OpenID, etc. getting traction outside the tech community?
Reads like a bad version of Douglas Rushkoff's <i>Exit Strategy</i>.<p><a href="http://www.amazon.com/Exit-Strategy-Douglas-Rushkoff/dp/1887128905" rel="nofollow">http://www.amazon.com/Exit-Strategy-Douglas-Rushkoff/dp/1887...</a>
There is a possibility that the like button on external sites could morph into an adsense competitor over time, if that is the case (and it is successful) then fb revenue has the potential to really take off.