Money Mondays

Facebook is a passing fad

I'm not an expert nor do I claim to be one, but what I like about life is that you can make guesses or hypotheses. My guess is that FB is a passing fad and its business model is not sustainable.

First of all, FB is not profitable and its use or value is limited. The management at FB HQ has only managed to come up with the same old business model of banner ads, other than that there is nothing revolutionary about their business model. Yes, they might be getting users at a rapid rate but that too seems to be going nowhere slowly. The one thing that's clear about business is that you have to generate cash, grow and be sustainable. If you can't fulfill the first requirement, then you will die. If you can't fulfill the second or third, you'll die sooner or later, it's as simple as that.

Now, FB is struggling to attract advertisers, all the online ad dollars are going to Google, who has a much better business model - search ads. Advertisers in Madison Avenue, love the Google business model and they're willing to vote with their dollars. The same cannot be said about FB. Since FB can only do one of the three prerequisites of a successful business, and that is grow only in user numbers, my prediction is that it will die, unless they come up with some super business model that will enable them to generate super cash. Now MySpace seems to be doing a better job at cultivating their value proposition, their focus is music and everyone who goes to MySpace knows why they are there, and so far this business model has proven to be successful and MySpace is profitable, to say the least.

Once you have "friended" more than a thousand friends, and checked their daily, "I'm at home lonely" statuses,what else can you do on FB?