The dudes at Facebook not only have done an amazing job in building the best social web site in the world, a site that, other than my 7 month baby, has managed to recruit all the other 5 members of my family, ages 13 to 47. But now, by allowing everyone else to come to Facebook, it has build a platform that within a year will become the most valuable social platform in the world.

What I wonder is, for how long is Facebook going to allow other companies to build businesses inside Facebook? Is Facebook going to begin asking for toll payments at some point in the future or will they be happy with the fact that, in any case, it all takes place there and they will find ways to monetize the new traffic? Seeing what they have done til now, my take is that the Facebook land grab will continue with the limiting factor here, being not acreage, but attention span.

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Homo Viator on June 20, 2007  · 

Hola Martin
In my blog post today, I asked a similar question: How will the advertising revenue that directly or indirectly derives from user-generated applications be split up between facebook and application developers? I guess that both parties should co-exist in a mutually beneficial relationship. Facebook benefits from increased traffic and product diversification, while application developers can piggyback on facebook’s impressive user base. Me and a friend of mine have thought of some interesting apps, but are still evaluating how we could make our potential share of the pie bigger. I guess that the key lies in creating apps that generate as much data on user-behavior as possible, while ensuring that the data is relevant to potential advertisers. Would be interesting to hear your comments on this. Do you think that application developers will get a fair share of the pie in the mid-future?

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Claudio on June 21, 2007  · 

Facebook has indeed grown exponentially in the last couple of months and I think you are absolutely on the money when you say it is a question of attention span rather than real-estate (a bit like second life, although as a virtual world it is potentially open to more permutations and will evolve to suit the changing needs of its community). In saying that, maybe through the use of innovative application plugins facebook can keep people interested long enough for it not just to become a useful diary and contact list….

As a side note: have you considered what this post may do to your friend requests on facebook? Maybe this is Martin going for the facebook friend record! 😉

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jonathan rose on December 2, 2007  · 

I understand and agree with your comments, but isn’t value truly calculated by income, cash flow and profitability. Whilst Facebook will have a huge number of users and be able to capitalize on the Social Marketing .com boom, what dso they really contribute and how will they survive are they not in fact a stepping stone to a new type of web…..

I always revert to Google which to me is an anathema, with only $4bn in profits on $10Bn in revenue how do they justify a 200+ billion valuation. They are close to the same net worth as Microsoft (approx $250Bn) and yet their revenues pale in comparison to the $52bn in revenue and the $20+ billion in profits……

Are we not looking at a new crash, a new dot come bust in the making when people realize that these companies next 20 years revenue do not justify their market caps!!!!

On the other hand i have to complement you on Joost which is truly disruptive and will clearly have a market in taking away business from cable and subscription TV….

This harks back to the days when companies had to do something useful and make a profit doing it to justify their valuation …..

Their former company Skpe kind of highlights this conundrum doesn’t it as EBay down valued them!!!!

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