The Facebook Fallacy - Technology Review

journo-geekery:

Michael Wolff, the Guardian’s media columnist:

…so far, the sweeping, basic, transformative, and simple way to connect buyer to seller and then get out of the way eludes Facebook.  So the social network is left in the same position as all other media companies. Instead of being inevitable and unavoidable, it has to sell the one-off virtue of its audience like every other humper on Madison Avenue.

…

…From a revenue perspective, it’s an ad-sales business, not a technology company. To meet expectations—the expectations that took it public at $100 billion, the ever-more-vigilant expectations needed to sustain it at that price—it has to sell at near hyperspeed.

The growth of its user base and its ever-expanding  page views means an almost infinite inventory to sell. But the expanding supply, together with an equivocal demand, means ever-lowering costs. The math is sickeningly inevitable. Absent an earth-shaking idea, Facebook will look forward to slowing or declining growth in a tapped-out market, and ever-falling ad rates, both on the Web and (especially) in mobile. Facebook isn’t Google; it’s Yahoo or AOL.

Via @mikeindustries on Twitter:

Is Facebook forcing the extinction of the ad-driven web? If yes, is that sort of destruction entirely bad? technologyreview.com/web/40437/?p1=…

— Mike Davidson (@mikeindustries) May 23, 2012