True. But to go a level deeper, Facebook is dangerous to Google, because: 1) The competitive advantage of AdSense ($10 billion in annualized revenue) is all about having better user profiles that can translate into better syndicated ads. Facebook will undoubtedly launch a competitor given the hires they have made. 2) The competitive advantage of AdWords ($20 billion in annualized revenue) is mostly about having better search results. Again driven by better user understanding.

Facebook has excellent information on users interests. As opposed to MySpace and Twitter, most of the data on Facebook is not crawlable. It's private data, which means that Google is completely locked out. Even if it was crawlable, the data is not as valuable since Google would have to try to interpret it, while Facebook knows what it really means.

Summary: Facebook is an existential threat to Google's two major lines of business AdSense and AdWords. This is going to be a huge drawn out battle. Sit back and enjoy the show.