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Web 2.0 Summit Day Two: The Facebook Seduction

[qi:010] Forget Steve Ballmer’s “you will dunk” quip, or whatever else happened inside the big hall at the Web 2.0 Summit, the story line for today was all-Facebook. The question about Facebook’s pending funding was repeated with mind-numbing regularity.

It was hard to walk the lobby and not have some be fascinated, bemused or simply disgusted by the $15 billion valuation being thrown around by Facebook executives, though they are not going to be that discreet. Some seasoned venture capitalists (a.k.a. ones who have no chance of getting a piece of the Facebook action) theorized it as a case of mass seduction.

Grizzled veterans were wondering why there was so much hysteria around a company that was trying to re-negotiate its advertising deal with Microsoft, even though the word on the street is that the prior advertising arrangements might not be working out, forgive the pun, as advertised.

A few paces down, one would run into guys talking about the gigantic ponzi scheme nature of the whole “facebook-application-providers-advertising-on-other apps” and how it was all going to fall apart once Facebook develops its own advertising network/technology.

Further down the hall, there were some who just couldn’t stop raving about Facebook, and the genius of Mark Zuckerberg, the 23-year-old founder of Palo Alto, Calif.-based start-up. I tell you what he is a genius at: making relatively sane folks lose their chakras over a company that may or may not work out in the long run.

Apparently funding Facebook is one of the reasons why Google co-founder Sergey Brin was spotted in the Palace Hotel a few hours after Google’s third quarter earnings call, and was likely to have dinner with David Sze, a Facebook investor as part of last minute lobbying, according to Valleywag. [Sze and a former Greylock Partners associate were seen having a quiet chat for relatively long time with a Valleywag correspondent, so one can assume certain elements of the Valleywag report might have reliable sources :-) ]
Update: A well-placed source of mine is disputing the Valleywag story, calling it inaccurate.

Google is said to be trying to arrange a complicated deal involving private equity investors. One name being rumored to have active interest in the deal is Roger McNamee, a Facebook addict and the driving force behind Elevation Partners. (McNamee hadn’t responded to my email asking him to comment on the rumor.) I am sure by tomorrow morning the crescendo around Facebook will have reached an all-time high, just in time for the weekend.

7 Responses to “Web 2.0 Summit Day Two: The Facebook Seduction”

  1. Om, the whole Facebook thing just goes to show that the secret sauce is communication between people.
    Now, how to make money out of that is another thing alltogether as people in communication mode are not prime target for ads.
    Personally, I’d start a Facebook voice communication service – using both VoIP and an MVNO model. That should generate a lot of cash pretty darn quick.
    But hey, maybe that’s just me.

  2. It’s not just Google and Microsoft that need to get a grip on Facebook, we all need to get a grip on ourselves. Yes Facebook is a good site, but it is not the new sliced-bread!

    I would be much more impressed with the acumen of the big web players if they were chasing after a web site that not every newspaper and web site on the planet had been talking about for months.