Bill,

As always, great thought-provoking piece. You and your readers might be interested in a post by Paula Thornton on the FASTForward blog, which, btw, is sponsored by FAST, the enterprise search company Micorosft is buying, that offers a slightly different perspective. In a nutshell, the idea is that web 2.0 and social media marketing is about engaging the audience in conversations, rather than the more traditional marketing objective of making an impression.

Here's the link to Paula's blog:
http://www.fastforwardblog.com/2008/02/06/market-ing-is-considering-conversations/

and here's the link to the blog she references:
http://blogs.mediapost.com/behavioral_insider/?p=242

Remember this, IBM put little effort into the PC because, in the early days, they considered it to be 'just a fad'

Fair point, Luke. The trick, of course, is to figure out -- or guess -- which is a fad and which is a real trend. Re social networking. I think that YouTube has had a significant impact on politics. The others; I'm not so sure.

It's not a fad - nor is it something that will last in its present form.

I wouldn't compare it to hula hoops (although I know you were having fun with the comparison - and I'm all for creative license). The kids will get bored, realize that virtual lives are rather vacuous and not fulfilling, and move on. The next generation of kids will be into something else. Sure, there will always be myspaces and facebooks - but they won't be obsessions for a whole generation - just useful and fun once and awhile. My prediction is that a future generation of kids will reject technology as a lifestyle - although of course they'll still use computers and cell phones and other products and services. They'll simply take them for granted.

IBM made a bad call - but you can't compare social networking to personal computers. PCs could have been a fad - only a small percentage of people had them in the 1980s and early 1990s. La-di-da social networking became insanely popular almost right out of the gate - ten thousand times more popular than personal computers were back in the Dark Ages. It's a true mass phenomenon, while PCs were play toys for only an influential, intelligent chunk of society. Actually - in the beginning they were merely glorified typewriters.

You're spot on with the advertising ROI comments. If there is a big 'fad' then someone is going to make big profits immediately. Nobody has figured out how to make a profit off social networking (except for the inventors and original investors). By the time they figure it out the 'fad' will be over.

I'm with Chuck. It's not a fad. I think social networking is continually evolving, and facebook is just a part of the evolution, not necessarily the end game.

Bill, coming from a generation probably closer to your daughters, Facebook can be both fun and useful.

As long as users are still interested, which I think they will be for a long time, someone will eventually find a way to monetize it without turning them way. Or at least that's the hope from those of us who like to believe it's here to stay.

I think the problem for large social networking services, like facebook, are that they have attracted a large group of users.

The success would be to segment the users, so advertiser can target specific segments. I strongly beleives that advertisement is the only options for this type of service to make money.

To charge for the service like online dating sites, do not make any sense. Users will leave, and we are alreasdy seeing in the online dating industry that revenues are drastically falling.

Many online dating sites are now, partnering or adding social networking features to try to keep their users.

My few cents!

I believe that social networking sites are definitely here to stay. They tap into certain behaviours that make people... human.

Most everyone wants to know what is going on in other people's lives, particularly if those people have some connection to the seeker. The connection can be very tenuous, witness popular interest in Hollywood actor's lives.

However news is interesting, and all the more so if it covers something the news subject doesn't want to talk about.

How is this business relevant? Well, it doesn't take much imagination to identify a need in business to talk openly about who is successful, who is less successful, why those characteristics have developed as they do, and so on. The needs go far beyond mere prurient interest (although they serve that too). Ultimately these reflect upon successful versus unsuccessful business strategies.

Want a solid example of what I'm talking about? From the realm of Healthcare, a gossipy and opinionated site called HISTalk:

http://histalk.blog-city.com/

It's anonymous because the contributors are insiders and the subjects could trip obvious sensitivities. On the other hand, you're never going to get a corporate PR flack issuing a news release saying, in effect, "regarding initiative XYZ, we really messed up, and it cost us millions. People have been sacked. Careers have been damaged. If we don't fix it soon the company could go under!"

That's what social networking sites could bring to the corporate table.