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January 08, 2011

Facebook is at or near peak hype

Douglas Rushkoff makes the point that it's not that MySpace lost and Facebook won. It's that MySpace won first, and Facebook won next. The longer the company can maintain the illusion of great profits without alienating its user base, the longer they can delay the inevitable decline. But given that Facebook has already begun cashing in its chips, that moment has quite likely arrived.

The actual peak is probably 2012 on the day of the IPO or the day after.

I definitely think that Facebook is stronger and more useful than Myspace.

However, Facebook claims 500 million users, so how much longer can they have high speed growth when there are 2 Billion internet users in the entire world ?

Also, the vast majority of the most active and most profitable users are already on the system. How much revenue opportunity is possible in some of the developing countries ?

There is also the vulnerability of not being able to increase market share from near 100%. Market share can only go down. China can also get more aggressive supporting the domestic system like they helped Baidu against Google. Other countries could do the same thing.




             World Population by Region   Internet users 
Africa                  1,013,779,050        110,931,700
Asia                    3,834,792,852        825,094,396
Europe                    813,319,511        475,069,448
Middle East               212,336,924         63,240,946
North America             344,124,450        266,224,500
Latin America/Caribbean   592,556,972        204,689,830
Oceania / Australia        34,700,201         21,263,990
WORLD TOTAL             6,845,609,960      1,966,514,816


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