I just finished reading a really thought provoking article in the July issue of  Wired.  In it Fred Vogelstein lays out Facebooks 4-step plan to change the Internet and replace Google as the center of World Wide Web.   Will it work?  I don’t think so, and here’s why.The first step Facebook has to accomplish is to archive critical mass.  There’s an argument to be made here that they’re getting there.  After all in April they claimed 200 million members.   Keep in mind that the reason members are important is that they theoretically represent dollars.  Not to get too far ahead of the story here, but step 4 is sell targeted ads.

What Vogelstein fails to look at and FB doesn’t highlight is where the bulk of the FB members are. The largest market for Internet advertising is the US, but up until very recently FB wasn’t even outperforming MySpace in the US let alone Google.

So where is Facebook really creating a stir?

Somehow I don’t think  Turkey, Croatia and Tunisia are the markets where the majority of corporations are looking to target their advertising dollars.

According to Vogelstein Facebook thinks its users will turn to each other rather than Google to navigate the Web.  “Why settle for articles about the Chrysler bankruptcy that the Google News algorithm recommends when you can read what your friends suggest?” asks Vogelstein.   Based on a little experiment of my own I am not so sure friends know best.  Back in May I was going on a 3 week trip that would afford plenty of time for reading.  I put out a request on FB to find out what friends would recommend I read.  I gave them details of books I had read and enjoyed and were the type I’d like to take along.  I also went to Amazon and searched the titles that I had already read knowing that their algorithm would make suggestions based on this.  Guess what?  The anonymous crowd on Amazon outperformed my friends and gave me better suggestions!

Beyond recommendations this step has the broader goal of  “redefining search”  Here Mark Zuckenberg, founder and CEO of Facebook may have made a critical error in judgement colored by his apparent disdain for Google.  Facebook encourages its 200 million users to use Microsoft’s search engine and has installed it on FB to make this easier.  The problem is that Microsoft’s search engine has been notoriously poor at offering the results users want.  If its latest effort, Bing, proves to be no better than all Zuckenberg has really accomplished is to diminish the experience of FB members.

Step 3? Colonize the Web.  To this end FB has formed partnerships with 10,000 other sites which they call Connect.  Now when you log into any of these 10,000 sites you can see your friends activities as they relate to the site and they can see yours.  This might be all well and good if it was just between friends, but Facebook has a creepy propensity for spying on its members and sharing data that members think is private with others, just think Beacon.

Finally we come to the Achilles heel of FaceBook.  In order to survive they eventually must start making money.  The current plan for making money is through running ads.  The problem is that FaceBook is not search engine and its users go to it as a destination site not a jumping off point.  More over, the last thing that we want when interacting with friends is to be interrupted by annoying advertisements.  Yes, Facebook has a tremendous amount of data on its individual members.  It knows if you like dark chocolate, going to the beach, what you like to read, if you’re pregnant or if you’re planning a vacation to Disneyland.  Not only can it serve you messages about the cutest baby clothes it can serve your friends ideas for baby shower gifts.  The problem for FB is that one of the things we’ve all learned from the past 15 years of using the Internet is how to filter out the information that surrounds the content we’re interested in.

The Internet is never going back to the pre Web 2.0 world where the only object was message delivery and information gathering.  What remains to be seen is if the interactive part of the Web can be monetized as well as the information gathering part has been.  It may well turn out that FB is simply not where the money is and if that’s the case than there massive server costs will surely bring them to their knees.