Facebook clocks fifth birthday
By Maggie Shiels
Technology reporter, BBC News, Silicon Valley
Facebook is giving its 150 million users a mystery virtual gift to celebrate its fifth birthday.
The gift shop's presents usually range from cuddly bears to a pint of beer and from champagne to a four-leaf clover.
Founder Mark Zuckerberg said, "In the spirit of celebrating connections
between people, we encourage you to use this gift to give thanks to
[those] you are connected with on Facebook."
In the battle for online friends, Facebook is now the world leader.
In a blog post, Mr Zuckerberg acknowledged the company's work in achieving its place as the biggest social network to date.
"Building and moving quickly for five years hasn't been easy, and we aren't finished.
"As we celebrate Facebook's 5th birthday, we continue to work
hard to evolve Facebook and make it as simple as possible to
communicate with and understand the people and entities that matter to
you," wrote Mr Zuckerberg.
In the blog he has also taken a trip down memory lane and
shared old images of how the site has changed since it was launched in
'Pet college project'
For a company that started in a dorm room, Facebook's rise has
been regarded as impressive with its 150 million active users beating
rival MySpace's 130 million users.
Facebook says more than 3 billion minutes are spent on the site each day
"They've gone from a pet college project to a global communications platform," said Jeremiah Jowyang of Forrester Research.
"It's a place where you can communicate with people you actually
know. It's different from other places on the web where those people
may not be truly your friend - like on MySpace where there are a lot of
celebs and fictional characters created by PR companies.
"Facebook is about people you really know and trust and it has
great crossover appeal to your real life, family and work," said Mr
Jowyang, who is conducting research on the future of social networks.
In his blog, 24-year-old Mr Zuckerberg said, "The culture of
the internet has also changed pretty dramatically over the past five
"Before, most people wouldn't consider sharing their real identities
online. But Facebook has offered a safe and trusted environment for
people to interact online, which has made millions of people
comfortable expressing more about themselves."
Professor B J Fogg, who ran a course called the "Psychology of
Facebook" at Stanford University, told BBC News: "Facebook has changed
how people view the world. Today, a friend from any country is just a
few clicks away.
"Facebook brings the world together - one trusted place," said Professor Fogg.
The 'in' thing
It was back in February 2004 when Mr Zuckerberg launched "The
facebook", as it was then known, from a Harvard dorm room. With the aid
of some friends, the aim was to help students keep in touch over the
internet and get to know each other better.
The average user has 120 friends on the site
Within 24 hours, 1,200 Harvard students had signed up and soon after
that the network was quickly extended to other colleges and
By 2005, an internal study showed that around 85% of students
in the network had a Facebook account. Another survey by Student
Monitor revealed that Facebook was the most "in" thing after the iPod.
At the end of 2005, Facebook hit the UK and today the site is translated across 35 languages with another 60 in development.
When Mr Zuckerberg filed letters of incorporation for Facebook,
he listed his job description as "Founder, Master and Commander Enemy
of the State."
Today more than half of the 150 million unique users are not at
college and the fastest growing demographic is 30 years old and above.
Everyday more than 15 million users update their status to tell
their friends what they are doing. They also show off photographs,
upload videos, chat, make friends, meet old ones, join causes, groups,
have fun and throw virtual sheep at one another.
"Social networking is nowhere as big a deal as it's going to
become. Right now Facebook is the predominant social network, the one
the other social networks want to be," seasoned analyst Rob Enderle of
the Enderle Group told BBC News.
Mark Zuckerberg started the site to help students connect
"As this space evolves, people are going to be living with these
social networking tools. They are going to become the new walled
gardens and form a more central role in people's lives."
But who will lead the pack? There is a plethora of social
networks but Facebook and MySpace are constantly pitted against one
another for supremacy.
"MySpace is like the messy teenager's room whereas Facebook is
where people will find their mum, cousins and friends hanging out. It's
like a hub," brand consultant Phil Edelin of Wolff Olins told BBC News.
However he said Facebook still has a long way to go to prove itself.
"We have been through the phase of enjoyment and self-indulgence on the site. It needs to innovate as a brand.
"It's been through the faddish phase and is now in a sticky
phase. But there are so many other social networks, it needs to stay
true to its brand and innovate and create," said Mr Edelin.
It is a sentiment that Mr Zuckerberg seemed to acknowledge in the birthday blog posting.
"The challenge motivates us to keep innovating and pushing
technical boundaries to produce better ways to share information," he
'Investing in vapour'
The perennial question for Facebook has been how to monetise the
site and cash in on its 150 million users who critically spend more
than two hours each day on-site. Analysts Neilsen compared that figure
to the 90 minutes users spend hanging out on MySpace.
As the pressure mounts on the Facebook team to make money, the job becomes harder amid the present economic downturn.
More than 70% of users are outside the United States
Market research company eMarketer predicted that US advertising spending on Facebook will fall by 20% to $208 million (£144m).
Despite the focus on the bottom line, Mr Zuckerberg has so far
seemed in no particular hurry to come up with a business strategy that
will translate into dollars and cents.
"We've thought about a number of different things, but that's
not something we've figured out. It's pretty clear that we haven't
figured out the optimal way for us to do this yet."
Forrester's Mr Jowyang suggested that for the moment, time is on Facebook's side.
"They are not in a rush and they don't need to be. They have
capital backing and they need to make sure the experience is good and
that people are really hooked into the system and then turn on the
monetisation," said Mr Jowyang.
Mr Enderle however said he believed the clock is ticking fast.
"At some time the economic model has to grow with the rest of the firm.
"Investors will want a return on their money and in this market,
investing in vapour can be very difficult. Their time is up for doing
this without making money.
"They need to develop a business model soon before they find their funding sources start drying up," warned Mr Enderle.
Professor Fogg sees things from a completely different view.
"Facebook has changed the game for all consumer-facing
companies. If you want to reach and influence everyday people, you've
got to understand Facebook.
"In the past five years, Facebook has shown us the future.
"The genius of Facebook isn't the technology or the interface.
Facebook is winning because it puts friends first. Our relationships
shape our online experience. No technology is better than our
friendships," said Professor Fogg.
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