by Mashable.com contributer, Mark ‘Rizzn’ Hopkins 
Jim Harper, one of my fellow panelists from the Privacy in the Digital Age panel from the Politics Online conference last week, wrote a short post over at Tech Liberation Front speaking to the rumblings of Google not being long for this world (inspired, in part, by a commenter from ValleyWag). Jim says:
Now, of course, Google isn’t all the way dysfunctional - far from it - but big organizations get slow, and this is some evidence that the process is underway.
For my own part, I’m a fan of Google and a user of AdSense on WashingtonWatch.com, but I haven’t run any AdWords ads in months. It’s too complicated for a person like me, who has a lot of competing demands on his time, to run a campaign that I’m confident can be cost-effective.
While I personally don’t think that Google has too much to worry about in terms of losing their dominant position, I know that there are those out there that think they do. I can never tell how serious Jason Calacanis is being when he says that Mahalo could possibly unseat Google one day, and I know that there are more than a few folks at Facebook that think they’re the be-all end-all of the future of the web (and a few folks at Google who decided they were right).
As Jim alludes to, though, Google is a bit top-heavy, their products and offerings have gotten mighty complex, and unlike the nimble and ambitious startups that are created on an hourly basis (like Google itself used to be a scant few years ago), they can’t react as quickly to market opportunities, shifts and changes. They’ve become a slightly less monolithic Microsoft, who followed the exact same cycle themselves, and couldn’t avoid eventually becoming as top-heavy as their then-antithesis, IBM.
Here’s the real puzzler, though. I found an article that goes hand-in-hand with the thoughts that Jim Harper expressed today over at Inside Facebook. There, Phil Edwards in talking about the ‘mythical’ Facebook gold rush explicitly acknowledges the fact that Facebook is not only having a hard time monetizing their service and staying profitable, but isn’t likely to ever be profitable should they continue their current path.
Ironically, applications may have a better path to monetization than Facebook itself. Facebook can sell against all the app traffic too, but apps give the social graph more meaning and value to users. That’s when brands get interested.
The Facebook application gold rush is already a success: developers have found traffic in massive amounts, while other websites spend years panning for as many visitors. Now, the railroads are being built to get the traffic to the brands that can use it.
Facebook, not profitable? You mean between all the Beacon ads, the in stream Mini-Feed ads, the Social Ads, and everything else, Facebook isn’t making any money? Well, they’re making money, just not enough to pay the bills as of present. Kara Swisher earlier this year got her hot little hands on some Facebook Financials. While they have a projected revenue of $350 million for 2008, they’ve got a projected cashflow deficit of $150 million, and a projected 2008 headcount of around 1000.
Meanwhile, niche social networks and multi-million dollar ad agencies in other tech sectors are being run on staff in the high single digits or low double digits. Somehow, Facebook skipped the garage startup size and went straight for the bigtime, and thereby forgoing the very thing that makes startups a dangerous weapon in the ever-changing tech market: a low headcount of highly gifted folks able to not only able to stay nimble but affordable.
Google waited until they were a multi-billion dollar company to go on a hog-wild hiring spree. Facebook couldn’t wait with a $15 billion valuation burning a hole in their pocket. Google, even with all their billions may still be outflanked by a new startup in the ad market, despite being literally the largest consortium of online advertising in existence. I can tell you one thing, though: unless Facebook pulls a rabbit from their hat (and one that doesn’t smell of Bacn), they won’t be the ones doing the outflanking.
In February, Bebo received 2.25 million unique visitors in the US, placing it between Buzznet and Imeem in the rankings, and representing less than 5% of the traffic that MySpace received during the same period. While it did represent 86% year-over-year growth, users spent significantly less time on the site – 81% less than they did in February of last year.
