And here I am predicting the Facebook Ad system

August 2007 in the Sunday Tribune:

Google are one of the most powerful technology companies ever and are the undisputed King of search with many pretenders to their throne. So why is a social networking site slightly better than mySpace or Bebo going to potentially be their most serious threat ever and not Microsoft, Yahoo! or Ask.com?

The hottest tech website this year so far has been Facebook. What once was a website dedicated to American college students proudly displaying their drunken pics and videos has now gained so much mindshare that even Rupert Murdoch, owner of Facebook rival mySpace has publicly stated he wishes mySpace were more like it. Individuals and businesses are flocking to join the latest online hotspot but the site isn’t so hot with search engines.

Unlike other social networking sites, Facebook does not allow search engines to come in and snoop around and catalog all the media being created and consumed inside this massive online community. For search engines like Google who are proud of their ability to monitor the web for newly uploaded content and display it in their search results as quickly as 15 minutes later, the inability to access a vibrant and energetic community creating millions of new pieces of data every day makes Google less powerful and less useful. Google’s motto of “organizing the world’s information” might need to add “except the data of 50 Million Facebook users”.

As with all social networks, their shine fades and people will move on to the next bright young thing. Being accutely aware of this, Facebook started giving developers access to the technology behind the site, allowing anyone to build applications which could plug directly into the Facebook. In one bold move Facebook turned itself into the web’s version of a lego set, where anyone could build any kind of creation on top of it. This new open “platform” is only around a short few months but already 1000s of new web applications have been built for Facebook which in turn has attracted millions more people to the website, causing them to create even more content Google can’t get to but the Facebook search engine can. Search companies see Facebook as a giant blackhole on the web because these Facebook applications suck in the world wide web but no data ever escapes back. Facebook now offers all their own content on top of everything you can get elsewhere online, so there is no need to leave.

If facebook offers everything to their users, then people will spend less time on the open web, which will naturally impact on Google and their ad revenues. With Google properties and partner sites getting used less, this is going to impact on Google ad revenue. Google as well as being a search company is the most successful online ad company ever and much of this is down to their relevance technology which matches the most suitable ad to whatever webpage is being viewed.

If Facebook emulated Google’s history and used an ad system like Google’s but tied into the detailed profiles of millions of Facebook people, they would easily out-Google Google. Ads on Facebook could be far more relevant than anything Google could offer, ecnouraging ad companies to flock to Facebook and pay a premium on ads, netting Facebook a fortune and hurting Google yet again.

With Google bloodied and battered from losing market share and ad revenue, Facebook could do one final thing to seal Google’s fate: Enable outside search. Facebook could build their own Google clone into Facebook offering internal and external search, tailored to the preferences of each individual with ads equally tailored. People currently speculate that Google might buy Facebook but maybe Facebook will end up buying Google?

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