The future of Facebook and other thoughts

by phil on Tuesday Dec 7, 2010 2:41 AM

How Facebook will get to a billion users and then top out

I just saw the recent 60 Minutes interview with Facebook CEO Mark Zuckerberg. Facebook currently has 500-some million users, but it believe it will top out at a billion.

Zuck outlines a vision of the Internet where everything is much more fun with friends. There is some truth to that, but it goes against the principle of the Internet which is its appeal to introverts. You go on the Internet to explore a world away from people, like the way a nerd dives into a library. I'm projecting, because only 30% of my interaction with the Internet is with people I know. The rest is random places like reddit, news sites, and Wikipedia. And the time I spend socializing online feels cheap or a means to an end, such as coordinating the next event or water cooler banter. Whereas the time I spend surfing the web and reading online articles feels like an end-in-of-itself and is a more valuable use of my Internet time. People willfully create programs to stop them from using Facebook so that they can focus on work, but I don't see people blocking Google or Wikipedia.

My understanding of Zuck, is that he has all the stock traits of the classically great entrepreneurs, such as tenacity and leadership. But one of his greatest strengths, his product vision, is borne out of a flaw. Every new update to Facebook's software seems like something my socially-oblivious computer science friends in college would find really cool. Take the most recent new feature, the one that lets you take any two friends of yours, and see all the wall-posts and photos between them. The normal person's reaction is "ew, that's creepy," but to Zuck, this is super neat. His voyeurism is creepy to the rest of the world, but it's totally normal to him.

However, Facebook ultimately trains people to normalize and appreciate what was once previously creepy, i.e. become Zuck. That's how Zuck became the king of the world. He has great entrepreneurial genes, sure, but its this personality gap between him and the rest of the world that sets him apart from any other would-be great CEO. Multiply this gap by the current super-transformative power of software, and you have an enormous gravy train for him to work through.

At some point, this gap will be closed. At some point, Facebook will have satisfied all the voyeuristic possibilities of social networks. At some point, there will be no new creepy features for Zuck to introduce. At which point, he'll turn into the Bill Gates who was a bore to watch when he left Microsoft. Bill Gates's gap was that he found computers wonderful, when the rest of the world hadn't yet. After he finally saturated the world with his way-of-thinking, he still kept singing his tune, by trotting out a tablet PC every single year at the new product conventions, clearly effusing with nerd-lust for computing, but without realizing that the simple virtue of having portable computing wouldn't be enough to push more product.

In the interview, you can see a glimpse of this future Zuck. He talks about a future where you're shopping online with friends, like you're going to a virtual mall. Right now, we pay attention, because he's the king of the world, but maybe all people will ever want to do on Facebook is share photos and play casual games. They won't want to use it for politics. They won't want to use it to search for information. At some point, Facebook's stock value will stay constant for 10 years, and Zuck will be standing on stage, excited about how connected everybody will become with his new feature, and people will be onto something else.

Will Zuck become an uber-CEO?

I'm reaching for the ideal of an uber-CEO, one that transcends his or her particular curiosity or passion, and is able to have a continued, adaptive success, even well after he's already maxed the world out with his product. I wonder if Steve Jobs will become something more than a Bill Gates. I feel like after the iPad, there is nothing left on Apple's bucket list.

Zuck is really young, though, and the youngest of this wave of technology super-CEOs.

Why does every publicly traded company have to grow 20% every year or die trying?

On the other hand, it's insane to keep expecting an unending inflation of these companies. How long can Google, Apple, and Facebook grow 20% every year? When they stop growing, Larry Page, Steve Jobs, and Zuckerberg will be canned. And then what?

Is it a foregone conclusion that Facebook will have a Microsoft/Apple/Google-style IPO?

Maybe Zuck should have sold Facebook for a billion. There's an air of complacency to this interview. We're still evaluating Facebook with the timescales of former tech blow-ups, like Google and Microsoft. What if in two years, everything's changed to Instagram or Groupon, or Zynga becomes bigger than Facebook, or we're all obsessed with the psi-power implications of Berm's studies, or Nintendo takes over finally, and your Miis are most important, or everything becomes a multi-verse social networking space, where everybody is on 100 different social networks, and Facebook is begging for your attention. Or the Netflix-Google-TV-Apple-TV thing becomes the dominant thing to do with the Internet. Or the end of Net Neutrality makes Comcast more important than Google and Facebook combined. Two years ago, we all thought Twitter was the end of Facebook. What if ten new Twitters come along in the next two years?

There's already talk that we're in the middle of another dot-com bubble, what with $4-6 billion valuations for Groupon, Twitter, and Zynga. But, according to my understanding of the Singularity, the distance between bubbles should be decreasing. And come to think of it, I feel like this would be the second dot-com bubble since the original one in the late-90s. I thought we were in a social networking bubble in 2005 when News Corp bought Myspace for $580M. And there was also a housing bubble somewhere in the past decade too. It's going to be bubbles all the way on through. Kids will create start-ups in cafes in the morning and sell them for $1M by the evening.