The fall of Facebook

The facts:
Facebook has 500 million users.
Facebook has 2000 employees.
Facebook has (only)1 comprehensive product.

Estimates (and not facts!):
Facebook is worth 100 billion (They haven't gone public yet).
20% of facebook employees are Xooglers (ex-google employees).

The FIGHT !!!
Facebook allows users to import their Gmail list of email contacts to find friends on Facebook.
Google asks Facebook to reciprocate by allowing users to export the emails of their friends on facebook.
Facebook start verbal war.
Facebook adds a so-called 'downloading' app , allowing user to download all his data. The fun is, that data can only be read by Facebook! Its of no use to users!
Google also bitches.
Facebook bitches some more.
Google shows middle finger.
Facebook slaps. Develops a hack around Gmail! Provides deeplinking to download contacts.
Google hits back hard. Now you get a very peculiar notice saying Facebook is "trapping" you !!
Facebook is launching email service in 2 days !! Project Titan a.k.a "Gmail Killer" !!!!!!!

Some Points:
The very talented, Lars Rasmussen, the man bwhind google wave, and respected all around has left Google to join Facebook. So have 200 others. Their job description is following : "come hang out with us for a while and we'll see what happens" Isnt this super cool !!?

In one case an engineer making around $150,000 turned down a 15% raise plus $500,000 in restricted stock and left for Facebook anyway.
This means he was getting more at Facebook !!? Or is the job better?? Lets compare...
The job:
Facebook and Google both have very cool and awesome working environments.
Facebook has only 1 big product(its website) and Google is  soooo very very ahead in the list of 'interesting' projects.
If developers are most interested in handling huge chunks of data sets, then (a) Google has much much more data and (b) all the scalability problems must have been solved on Facebook long ago since it already has 500 million users.
So we can conclude that it's not the work environment or job interests. That leaves us with only two options.
Personal Conflicts.
It must be a great reason behind Lars Rasmussen leaving Google because Google shutdown his project 'Google Wave' prematurely. It was a wonderful product!
But since this may not be the case behind everyone, only one option left.

We have two examples. First is mentioned above. He left a salary of 175,000 plus 500,000 in stocks !!!
Second case of a staff engineer at Google being heavily romanced by Facebook was offered a jaw dropping $3.5 million !!!  in restricted stock by Google (this means Google is handing over stock worth $3.5 million based on its value today, and that stock will vest over time). He quite wisely accepted Google’s counter offer. Facebook lost this one.
So maybe we can conclude that Facebook is paying more than half a million and less then 3.5 million to the Xooglers. No one knows the exact amount.
So let us give the benefit of doubt to Facebook and assume the price to be 1 million.
i.e, Facebook pays 1 million in stock to Google employees to join them.
Given that Facebook has 20% of its employees as Xooglers amongst the 2000 totals, an amount of 200 million in stock is already given away !!

Now here is the fun part. Facebook is NOT WORTH 100 billion! It is just a projection, and for an ambitious two years into the future !!! A prediction of Facebook's value in 2013 !!!!! Forbes reported Facebook's value to around 18 billion dollars only !! If so, 12% company is gone already !!

The fall of Facebook
I think that people are now going to leave Facebook. The reasons:
1. Freedom factor, the sense of being trapped.
2. Increasing spam.
3. The next big thing is in the wait. When it hits... The same happened to MySpace.
4. Future is not about social. Theorists say that the birth of internet was marked by 'informational' (the past), the growth by 'social' (the present), and the future is about 'personal'. It is already evident with the huge mobile market share that is a part of a very personal experience.

Why am I on Facebook? 'Cause it's cool. And what makes it so? Most of my friends are there. (And hence you'll leave too when they start leaving.) I love the apps. (Until they spam me. And are all profit based third-party and hence they will move too.) The data resource. (Videos from youtube? Links from around the web? All external.)
Facebook is fashion. Like friendster was. Like MySpace was. Fashion will change.
In fact MySpace had exact the same share of internet as Facebook has now !!!
Facebook will not shutdown in 2-5 years. It will be there. Like MySpace still is. But the 'tip of the curve' is reached, and will be 'downhill' soon. I predict it will be pretty evident in June 2011, 6-7 months from now.

(PS: I am on Facebook. Its the most detailed source of Indian Rock Music. Also I can stalk my ex.)

Update: Paul Buchheit , the creator of Gmail, had joined Facebook, and has left it for YCombinator.(\m/)

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