Everything new about facebook (widgets/apps/etc) is more or less opposite from why everyone old joined up. The only feature change that improved the facebook/brought in more people was the newsfeed and that was only after initially running into a huge resistance against it from within the community.
Hustling to find a way to monetize the users by continuing to add features isn't going to get them far. What else could be done to dramatically alter the experience and generate more people or more activity? I think the success has gone to Mark's head and agree that he should cash out now.
Not to say that it won't be a service used by millions for years to come, but the model for growth seems to have hit it's peak.
1) If you build a cool site that's interactive and brings in lots of users, most likely it has a "popularity curve" where it's really cool at first, then it's the thing to do, then it's kind of old hat, and finally you are left with the die-hards. Perhaps some sites keep users for 15 years, but to me building the next cool social networking site for pet rock lovers (or whatever) looks more like creating a popular TV show.
2) Big companies come along and buy up these small fish while they are in their growth phase. The more users you have and the faster you are growing, the more perceived value you have.
3) They then absorb small fish into their larger operations, eventually completely consuming small fish. Oddly enough, this keeps them from following the same popularity curve as everybody else: they are always refreshing the mix by bringing in new blood and content. This means there is a huge amount of pressure on large organizations to buy up small companies. Very interesting.
4) As an entrepreneur, you always have to ask yourself whether you still have a long way to grow, or if you are closing in to your peak. The related article says that Facebook will peak, and I believe it. The problem is that every company believes it will change and dominate the world as we know it. Rationally, Facebook owners need to make the call about where the most value is. But there might not be a lot of rational thinking going on at this point.
Sorry to repeat all of that. I was just trying to get my head around the concepts in the related articles. Good food for thought! I love contrarian articles.
Swisher is entitled to her skepticism but it's a little absurd for her to be offering Zuckerberg valuation advice, implying parties to the negotiation are 'delusional' and 'insane'.
A company is worth whatever someone is willing to pay for it. Those with ultimate say over whether FB is worth $X billion are those who buy and sell $X billion companies, in whole or significant part. That includes people advising and courting FB, who know a lot about its internals, prospects, and strategic value.
As Swisher notes, a few months ago, when speculation centered on a $6 billion valuation, she suggested in that range, Zuckerberg would be a 'fool' to not take the money and run. Well, if the latest WSJ report is to be trusted, now valuations over $10 billion are on the table. So what was the foolish advice?
http://kara.allthingsd.com/20070925/15-billion-more-reasons-...