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Three things that could kill Facebook

Let the Facebook road show—and the dissection of its future as a public company—begin.

In The Age of the Platform, I write extensively about how platforms by themselves guarantee nothing. Think about how companies like AOL, MySpace, and Yahoo! have fallen from grace in recent years. And I’m hardly the only one who feels this way. Eric Jackson on Forbes makes the case that Google and Facebook might suffer similar fates within five years. Is it possible? Sure. Though I suspect it won’t happen, primarily because these companies understand Clayton’s Christensen’s innovator’s dilemma: in a nutshell, the very things that make a company successful ultimately cause its demise.

Even so, let’s examine Facebook and the forces that could derail this 900-million-member social network. At a high level, there are three: Facebook itself, the competition, and the unknown.

What Facebook Does

Facebook 2.0 has already launched. Its access to capital means that it can buy patents and photo-sharing apps for more than $1.5 billion in less than a month. Bigger deals come with greater rewards, but also with greater risks. Instagram represents a significant amount of the company’s cash stash and, at a minimum, may impede its ability to do other deals.

…to read this article in full, visit leading US small business resource, Inc.

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