Facebook IPO: No, Facebook is not just a fad
Despite the coming Facebook IPO (or maybe because of the coming Facebook IPO), half of all Americans think the popular social network is a fad. They're wrong.
With the Facebook IPO just around the corner, investors need to guess whether the social network has lasting appeal.
According to the results of a new Associated Press-CNBC poll, 43 percent of Americans think Facebook will be successful over the long term, while a full 46 percent think Facebook will "fade away as new things come along."
Are they right? Well, yes, partially: History shows that no tech property can single-handedly dominate a given market for an indefinite amount of time.
Take America Online, for instance, which connected millions of Americans to the Web for the very first time, and then slowly faded into obsolescence. Or look to MySpace, which dominated the social networking sphere for years, before being toppled by Mark Zuckerberg and a few of his college pals. It's certainly true that everything has a shelf life, even in the upper echelons of Silicon Valley.
But Facebook's shelf life is likely to be much longer than AOL's and MySpace's, if only by dint of its incredible size and scope. AOL, at its very peak, never counted more than 30 million users worldwide. In its salad days, MySpace had 100 million. Facebook has close to 900 million, and smart money has the social network hitting a billion by the end of 2012. To put that in perspective, there are about 7 billion people in the entire world.
Facebook is everywhere – on our mobile phones, on our laptop screens, and soon, assuming all goes well with the IPO, on the stock market.
And as some onlookers have pointed out, there's no particular reason to think that Facebook's growth has even begun to slow. "Even if Facebook never adds another user, it will keep growing: It has become a fundamental substrate, a difficult-to-avoid component of any site or app that requires users to register – making it essential to nearly every major web innovation now and in the future," Paul Ford wrote recently in New York Magazine.