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These past few weeks I have been addicted to Facebook games, playing Mafia Wars and Farmville day in and out. It’s lame, actually. These are very simple games where you just need to repeat some actions over and over again. But so addictive they are, sometimes I’d forget the whole reason I go online and just play, one game after another.

Interestingly, I came across Scamville: The Social Gaming Ecosystem Of Hell at TechCrunch last week just at the height of my Facebook addiction. (I have not been checking out Tech Crunch for sometime, but this post at JohnChow.com has gotten my attention). When so many companies are making such ridiculous amount money from it, you know this is no joke matters.

Anyway we look at it, Facebook is huge. While saying that Facebook accounts for 25% US pageviews is a gross exaggeration , we can deny that Facebook (and its large number of third-party apps) is changing the web and the definition of how people use Internet.

Facebook will be going down, just like Friendster, MySpace, LinkedIn, and …(enter your favorite fallen social networking site here)
It’s a very popular notion among bloggers, web marketers, and tech writers to assume that because all previous popular social networking site has actually met some decline, Facebook will suffer the same fate and will eventually be overtaken by some newer, better, more popular networking site. While this might not entirely false, there are few factors that work in Facebook favour and make Facebook a bit different from the previous networking sites. These few factors might actually change the tide and allow Facebook to grow and become a giant corporation just like Google has.

• The real game is in the apps. While Facebook as a social network has enjoyed good growth, it really only took off after they work with developers and allow third party apps (games, quiz, and some actually useful apps) on the site. It’s hard to tell how much of the visit is for the core Facebook and how much is for the apps, but gauging from my personal Facebook News feed, there are much more applications status update than conversation or video/photo posting.
• Facebook is for real people networking. While implementation has been extremely difficult, Facebook has a strong policy for requiring real name registration.
• Facebook mobile. Never before the web is so mobile. This is specially apparent in third world developing countries such as India, China or Indonesia. IPhone, Blackberry and Blackberry-like smartphones with Facebook-function are snapped like there is no tomorrow. Many of the users are people whose only knowledge and use of the Internet is Facebook.

Show Me The Money !
Facebook has finally turn profitable last quarter, earlier than the expected 2010 profitability. That is hardly coincidence as Zynga, the biggest Facebook game apps maker is expected to make over 250 million in revenues this year. Even with the recent pull-out of offer ads, they will probably still able to make close to that figure. It is no coincidence either, that both Zynga and Facebook are expected to IPO by next year.

But this is also the part that I find disturbing. Zynga makes money from its Facebook apps. In turns it spend a big amount of the revenue back into Facebook advertising. I strongly believe they should diversify their source of income. Currently, Facebook derive almost all of their income from sidebar advertisement. Which isn’t a bad thing, really. The bad part is that most of the advertiser are actually advertising their Facebook apps. This is very risky. If for some reason or another the big accounts pull out, the ads bid price will drop like crazy and Facebook will lose more than what the big accounts spend.

How Facebook could be better

• Getting more actually useful apps. While certainly there are some useful apps in Facebook, majority are games or meaningless quizzes. To adds value to user’s spending time on Facebook, they could certainly do with better, useful apps for their users.
• Creating its own popular apps. If the third party developers can make huge loads of money, Facebook could certainly do better. They can have apps division and compete with third party developers. This way Facebook can make more money while at the same time providing better apps.
• Less noise. I despise Twitter. It has turned from a good way to know what’s going on in my little world to a huge shoutout war. I rarely get any meaningful information anymore. Of course, I can just unfollow people, but then that makes it pointless. Facebook news feed is still so much cleaner today, but I loathe to think that someday Facebook will turn to another Twitter.

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