Myspace to join Google’s Open Social. Facebook’s value plunges.
It is a mildly risky but potentially brilliant counterstrike against Facebook’s rising popularity. Myspace will announce shortly that they are joining the Open Social movement spearheaded by Google and which is now officially a social juggernaut of global proportions. TechCrunch seems to have the latest on this breaking story.
If Facebook was worth 15 billion yesterday I’d suggest it just dropped by more than 50% in value. Why? Without Myspace’s hundreds of millions of users Open Social looked like it would be a third player in the field, struggling to catch up with the user bases of Myspace and Facebook and keep up with Facebook development. But not any more. With Myspace, Open Social instantly becomes the key social network, dwarfing Facebook by any reasonable measure of prominence. Can new Facebook partner Microsoft help sway onliners and developers to stick with Facebook’s “partly open” architecture instead of defecting to what appears to be a very open Google architecture? No way.
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Precisely the elements I’ve recently emphasized:
There are no real barriers to entry or barriers to innovative programming and while a certain number of website users are necessary for functionality the total number of users will vary with whims of teenybobbers or titans. How “bankable” was all that value that you think evaporated overnight? Proprietary algorithms? Locked-in users?
Value is based on Earnings not ‘glitz’ as portrayed on MTV or Nicleodeon or the tabloids.
FG – yes, though I’m not clear people are “devaluing” Facebook as I think they should be. They’ll still be a player but recent developments mean they’ll be far less significant as a key player.
Facebook is toast! this is a killer app. Myspace and Google together is a unbeatable one two punch. Besides, Facebook is still on a learning curve as can be seen by how they are constantly changing their developers documentation and rules for conducting business on the platform not to mention apps disappearing into thin air. Google/Myspace is the gold standard and will implement OpenSocial much more smoothly. Facebook is a walled garden and it indiscriminately picks and chooses which apps get high visibility while it tweaks it’s platform to keep other apps from suceeding.also they deny apps submission into their directory on a whim. they’re a bunch of nuvo rich wannabe stuckup spoiled brats who thought they had the world on a string. now they must eat humble pie and bow down and kiss the ring that is Google/Myspace. Oh well,so much for Facebooks 15 billion dollar valuation. they’ll be lucky if they can get 1 billion now. why develope on Facebook which claims to have 50 million members when you can develope on Google’s/Myspace platform which has 200 million members…do the math. Who’s crying now! Facebook is toast!
Ok, so Google copied Facebook’s idea, to make sure Facebook wouldn’t grow out of proportion. OpenSocial now allows any website to have pluggable apps at no development cost. This doesn’t mean the end of Facebook, the competition just caught up. The power of the network lies in the number of its users. So what if salesforce.com now has OpenSocial. That doesn’t affect Facebook one bit.
I think Facebook is already a step ahead, they thought about monetizing their platform, without needing Google’s ad network: http://www.techcrunch.com/2007/11/02/ok-heres-at-least-part-of-what-facebook-is-announcing-on-tuesday/
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