In particular both BIG brand publications site comparisons of Facebook vs. Google and both take dueling views of the space and the current rise in valuations of social networks.
The Fortune article titled Why Google Fears Facebook states "By even the highest valuation, Google is still more than 15 times the size of Facebook. With a market capitalization of $190 billion, Google could eat the social network for lunch, and yet it's Facebook that's got the Web giant running scared. Google understands that it needs to grab a foothold in social networking, but Facebook, frustratingly, isn't for sale. And given its ad ambitions, Mark Zuckerburg's Facebook reminds one of a pre-IPO Google, circa 2003.
Google's Facebook war is about more than just talent: "The stakes here are about as high as they get in the Internet business," he says, adding that this war is the most significant since Microsoft challenged and beat Netscape for control of the Web browser. Social networking represents the future of the Internet-and that's where the next great Internet fortune resides, he says. Read the whole story...
The October edition of The Economist writes "There's less to Facebook and other social networks than meets the eye" The writer specifically suggest that the social graph feature and functions of social networks does not justify an over hyped value.
The Economist articles says "This suggests that the future of social networking will not be one big social graph but instead myriad small communities on the internet to replicate the millions that exist offline. No single company, therefore, can capture the social graph."
"Ning, a fast-growing company with offices directly across the street from Facebook in Palo Alto, is built around this idea. It lets users build their own social networks for each circle of friends."
"So are Facebook and its graph really worth many billions? From an advertiser's point of view, says Rishad Tobaccowala, the boss of Denuo, the new-media unit of Publicis Groupe, an advertising company, Facebook is so far anything but the new Google. The search giant does have traditional network effects in its advertising system, he says: it aggregates advertisers and sends them to potential customers who have expressed specific intentions by typing search queries. But Facebook has only "large crowds who are communicating without expressing specific interests", says Mr Tobaccowala. On Google, advertisements are valued; on Facebook they are an annoyance that users ignore."
"But that possibility hardly justifies the sorts of valuations bandied around for Facebook and other social networks. Such valuations, indeed, may reflect a misunderstanding of the social graph. For bigger companies such as Google, the graph is simply the web of links among its many users. It can be used to make existing services more useful. But Google increasingly views such utilities as "features, not products," says Sergey Brin, its co-founder. Facebook, like many hot start-ups in Silicon Valley, has some fantastic features, but maybe not much " Read the whole story.....
Systemically speaking the economist article appears to miss the emergence of economic opportunities that lie beneath the surface of any social networking platform. The article references Google's attitude towards Facebook as " a misunderstanding of the social graph" which doesn't justify the evaluations given to the likes of Facebook. The Fortune article addresses not only the growth of Facebook's users and it's evaluation but the fact that talent from Google seems to be migrating to Facebook and thus a reference to a "war" between the old and new web giants.
So which article provides the best perspective?
One may be inclined to suggest that since the Fortune article appeared first The Economist was lead to follow with an alternative perspective opposite of the Fortune article. It seems ironic that the Economist article totally dismisses the grounds of Facebook's growth and evaluation as nothing more than what Google has been doing for years in terms of features offered to consumers.
When you consider the size of the emerging virtual world, see Global Connection Factors, and the momentum of the mediums it seems logical to suggest that the next wave of developments will only fuel the space faster.
Whatever valuations develop for Facebook, or any other social network, the adoption rates by consumers followed by businesses is a "tipping point" not to be ignored or discounted. The medium of social networks is growing faster than any other web development in its history.
The BIG appear to be shaken by the speed and the potential shifts represented by the medium. The very dynamics of the space is disruptive and as such it is likely to fuel further controversy from the BIG. The small are gathering in swarms and the wave of user generated content combined with the power of people connecting is creating a Tsunami of potential change, a shift in power and possibilities for The Relationship Economy to emerge as fast as the medium itself.
What say you?