It's one of the fallacies of human psychology that people, particularly young people, have a false sense of urgency. 10-15 years ago Microsoft was an unstoppab

It's one of the fallacies of human psychology that people, particularly young people, have a false sense of urgency. 10-15 years ago Microsoft was an unstoppable behemoth. Many--me included--had a hard time seeing how they wouldn't completely dominate the computing landscape. Since then Microsoft is still a behemoth but this is largely based on inertia. I don't fear Facebook becoming or owning the Web. In time there will be a new meme that will unseat Facebook. This inevitable decline is also part of the human condition. Facebook is still in this nascent period of growth. At some point they'll become so large that there really is nowhere to go. So then instead of playing an offensive game, they'll play a defensive one. Every new idea will be a threat to their turf. It happened to Microsoft. It'll happen to them. Microsoft, as it exists now, is a vehicle for selling Windows and Office licenses. Nothing else matters. Look at the disastrous Kin. You take the successful Sidekick (which MS bought) and then spend two years rewriting the OS to be some flavour of Windows. And it dies. Look at Sony. The PS3 is/was a weapon in the next-gen optical format wars. This delayed its launch giving the Xbox360 a huge first-mover advantage. The cost of the Blu-ray drive gave the Xbox360 a price advantage. I call this the advantage of singularity of purpose. The more you try and do, the greater disadvantage you're at. It's why small startups can succeed against behemoths. It's not just that they're more agile. It's that startups don't (generally) have conflicting goals (eg Microsoft's phone division wants to make great phones but Microsoft wants to sell Windows licenses). Facebook is already showing signs of defensiveness typical of behemoths. Just look at their reaction to Twitter and them co-opting basically everything else anyone else does (eg Places a la Foursquare). Foursquare may well be dominant for the next year. It's valuation in that time may go 5x or even 10x its alleged $35 billion valuation. But something will unseat it eventually. Even the Roman Empire died eventually. One of the biggest use cases for Facebook seems to be for games and this is where I think they're weakest. It's something for which your social graph has very little meaning most of the time. I've played 1-2 of these games and typically you find a bunch of random people to neighbour/ally/etc with rather than people you know. What value does this have being inside the Facebook ecosystem? None other than possibly discovery. One thing worth noting is that valuation really means anything but. Valuation in the classic sense means the ability to generate income. Valuation in terms of the stockmarket, VCs and investors is something else entirely. It's nothing more than an opinion or expectation on future value. Google makes more money than ever yet it's value peaked in 2007. At that time the sky was the limit (or so it seemed). Now? It's not seen as being as sexy as it once was. One last thing: the social space is (clearly) "hot" at the moment. In my opinion I think there is a definite "social bubble" that will at some point burst. A lot of importance is placed on the "social graph". This is particularly true when it comes to the (currently unrealized) future of "social search". Personally I don't think this idea has nearly as much potential as some seem to think it does. Some think that Facebook's ownership of the social graph will eventually give it a competitive advantage against the likes of Google. I disagree. What's made search successful is scale. What's the advantage of limiting that to the people you know rather than everyone in the world? Anyway, Facebook will eventually be another Yahoo.