Can Anything Stop The Facebook Juggernaut?

In 1986 IBM recorded the largest profit ever recorded by any corporation in the the history of the world. Nothing would ever be able to compete with IBM. The media was in a swoon about how amazing IBM was. But IBM was already losing ground in the PC market, and they were losing ground in electronics to the Japanese. In 1993 IBM was struggling to avoid bankruptcy.

Circa 1991/1992 there were articles about how Japan was taking over the world and nothing could ever compete with them because they were relentless. But the early 90s marked the beginning of global retreat for many Japanese companies (with a few exceptions, like Toyota).

In the late 90s nothing could stop Microsoft, yet the late 90s marked the beginning of the era when Microsoft's momentum began to fade.

Somewhere around 2006/2007 Google was the most perfect collection of human beings that had ever thought to work together and nothing anywhere, ever, would ever be able to even conceive of an idea that could compete with Google.

In 2010 Facebook is an unstoppable juggernaut and nothing will ever be able to match the unbelievable genius that runs this organization.

In 2014 MingaMingaYXZ corp is run not by mortals like you and me, but by people so inhumanly smart they must really be gods that have temporarily taken human form.

Then in 2016 we will be told that MingaMingaYXZ secretly had problem abc the whole entire time, and so they never really had what they needed to compete against ZunkZunk corp.

Around that time, the media will tell us that ZunkZunk corp is, of course, run by people of such incomparable brilliance that aliens from the future travel back in time to beg for advice to deal with the problems they face a million years from now.

Facebook is the new AOL. A "training wheels" site for the rest of the internet.

The cycle of new sites taking market share away from the leaders will be a regular ongoing event, much like the boom-and-bust cycle in silicon; and like the weather.

As interoperability increases, as it has been doing with emulation layers, virtual machines and dual-booting, new sites will offer "translation stages" to help everyone keep possession of their data.

This day is here already, with "inter-CRM" transfer sites. The scrapers and data-porting sites will stay on the attack; each new market leader will have to win on their merits, rather than according to their walls.

Walls, dang. That went out with East Germany, one would hope.

Here's to a better future, to all 450,000 of my best friends.

Social networking is very trend-driven. If something new and exciting comes along, or even if cultural views shift and facebook is no longer considered cool, it could die almost overnight. Of course, due to it's huge user base, it would take a while to die (like myspace).

10-15 years ago Microsoft was an unstoppable behemoth. Many--me included--had a hard time seeing how they wouldn't completely dominate the computing landscape.

Since then Microsoft is still a behemoth but this is largely based on inertia.

I don't fear Facebook becoming or owning the Web. In time there will be a new meme that will unseat Facebook.

This inevitable decline is also part of the human condition. Facebook is still in this nascent period of growth. At some point they'll become so large that there really is nowhere to go. So then instead of playing an offensive game, they'll play a defensive one. Every new idea will be a threat to their turf. It happened to Microsoft. It'll happen to them.

Microsoft, as it exists now, is a vehicle for selling Windows and Office licenses. Nothing else matters. Look at the disastrous Kin. You take the successful Sidekick (which MS bought) and then spend two years rewriting the OS to be some flavour of Windows. And it dies.

Look at Sony. The PS3 is/was a weapon in the next-gen optical format wars. This delayed its launch giving the Xbox360 a huge first-mover advantage. The cost of the Blu-ray drive gave the Xbox360 a price advantage.

I call this the advantage of singularity of purpose. The more you try and do, the greater disadvantage you're at. It's why small startups can succeed against behemoths. It's not just that they're more agile. It's that startups don't (generally) have conflicting goals (eg Microsoft's phone division wants to make great phones but Microsoft wants to sell Windows licenses).

Facebook is already showing signs of defensiveness typical of behemoths. Just look at their reaction to Twitter and them co-opting basically everything else anyone else does (eg Places a la Foursquare).

Foursquare may well be dominant for the next year. It's valuation in that time may go 5x or even 10x its alleged $35 billion valuation. But something will unseat it eventually. Even the Roman Empire died eventually.

One of the biggest use cases for Facebook seems to be for games and this is where I think they're weakest. It's something for which your social graph has very little meaning most of the time. I've played 1-2 of these games and typically you find a bunch of random people to neighbour/ally/etc with rather than people you know.

What value does this have being inside the Facebook ecosystem? None other than possibly discovery.

One thing worth noting is that valuation really means anything but. Valuation in the classic sense means the ability to generate income. Valuation in terms of the stockmarket, VCs and investors is something else entirely. It's nothing more than an opinion or expectation on future value.

Google makes more money than ever yet it's value peaked in 2007. At that time the sky was the limit (or so it seemed). Now? It's not seen as being as sexy as it once was.

One last thing: the social space is (clearly) "hot" at the moment. In my opinion I think there is a definite "social bubble" that will at some point burst. A lot of importance is placed on the "social graph". This is particularly true when it comes to the (currently unrealized) future of "social search".

Personally I don't think this idea has nearly as much potential as some seem to think it does. Some think that Facebook's ownership of the social graph will eventually give it a competitive advantage against the likes of Google. I disagree. What's made search successful is scale. What's the advantage of limiting that to the people you know rather than everyone in the world?

Anyway, Facebook will eventually be another Yahoo.

[1] http://books.google.com/books?id=RMd3GpIFxcUC&pg=PA191

Take, for example, http://www.guardian.co.uk/commentisfree/cifamerica/poll/2008... http://www.noozhawk.com/mark_shields/article/1109_mark_shiel...

These predictions have clearly proven false; they are mere protractions of two recent events glued together.

Quote of the day - I never could clearly express what exactly I dislike about Facebook. It's just not joy to use. UI is mediocre, functionality is mediocre, even API is mediocre.

Companies aren't armies and the internet isn't a battlefield. Facebook provides some services which you may find useful, just like Google or Amazon. You have alternatives and you have the freedom not to use a given company's services. It's really nothing more elaborate or sinister than that.

People get bored. People grow up. People move on.

Just like everything, Steve Jobs will redefine how social networking should be done and people will agree. Steve is definitely itching to making strategic partnerships and spend some of that 50+ billion cash reserve.

Facebook's instant personalization is the most interesting piece of web infrastructure since, well, advent of the web itself. It's scary too, but big, fundamental improvements usually are.

If they succeed, Facebook will become something much more important than a giant walled garden. Walled gardens wither eventually, but being a critical piece of web infra, that's something huge.