Facebook: Movement or Business?

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Eric Risberg / AP

Mark Zuckerberg, founder and CEO of Facebook, delivers a keynote address at the company's annual conference in San Francisco on July 23

It's been a heck of a year for Facebook, everyone's favorite social network. That was obvious when founder and CEO Mark Zuckerberg took the stage at F8, the annual developers' conference in San Francisco on Wednesday.

With a series of slides that looked like textbook examples of "hockey stick" growth, Zuckerberg showed how quickly his network has taken off. A little over a year ago, Facebook had 24 million users. Today? Zuckerberg claimed that 90 million folks — two-thirds of whom are outside the U.S. — use the network. He pretty much guaranteed that the number of active users would hit 100 million by year's end. Some 200,000 programmers are making applications for Facebook, and have attracted more than $200 million in investment. That's a lot of users and developers, and a spectacular amount of dough. Zuckerberg and his team ought to feel pretty great about what they've built in a relatively short period of time.

So, I don't mean to be a total tool when I say: Knock it off already with this talk of a "movement." That's what Zuckerberg called Facebook throughout his hour-long presentation yesterday: A movement. As in, "Last year at F8, everyone here together at the San Francisco Design Center started a movement!"

O.K., it was cute when he said it at the first F8, last year. It got your attention. It was exciting. Especially coming from the tech world's Doogie Howser. But now?

Zuckerberg may want his users to think of Facebook as a movement, but to the grown-ups it's a business — and one that's working very hard to be profitable. But it's got a ways to go before it's in the money, and all this "movement" talk makes me suspicious — like Zuckerberg's putting something over on me. I'm not saying he is. I'm just saying.

Yesterday, while he talked about the movement and how Facebook's goal was to be a place that promotes sharing and connecting, I couldn't help thinking about Beacon. You might recall that Beacon, an advertising play, was intended to broadcast Facebook users' purchases from external websites. Initially, it was forced on users; there was no opting out. But that turned out to be a nightmare for the young company. Zuckerberg had to apologize and retreat. "We made a lot of mistakes during the past year," he admitted yesterday. Clearly, explaining to your users how advertising works on a social network was one of them.

And so at the developers' conference yesterday, we saw a kinder, gentler Zuck who, though he embraced "transparency" as a laudable goal, was charmingly opaque.

"When we talk about the movement we're a part of, it's important for us to have a very clear sense of our mission and the purpose behind what we're all doing," the new "What, Me, Beacon?" Zuckerberg told the audience. Then he launched into a story about how he and the Facebook team were trying to come up with a mission statement for the movement about six months ago, when he had to go on vacation to Istanbul right in the middle of the discussion. Once there, he had dinner with a local entrepreneur and had a terrific time, feeling a powerful connection with this person. Afterward he had an epiphany about what Facebook should be: "I really want to see us build a product that allows you to really feel a person and understand what's really going on with them and feel present with them."

That became part of the new mission statement for Facebook: "Giving people the power to share, in order to make the world more open and connected."

I'm not being sarcastic when I say that sounds lovely, really nice. I love sharing, especially the steak on my wife's plate and TIME Inc.'s money. This is sharing — and then some.

"Sharing" at the conference referred to the new features that Facebook unveiled this week for its redesigned user profile pages, which now make it even easier for me to broadcast the stuff I like. "News feeds" (a Facebook term I've always found vaguely offensive, since it trivializes actual news) are now simpler to manage. When you read a "story" on your news feed and find out a friend has just enjoyed a Big Mac, you can comment on it ("OMG! Me too!!!"), right in the feed. And FacebookConnect, which will start showing up on finer websites and blogs everywhere this fall, is an ID system that lets you log in to places — for commenting, say, or Digging stories — with your Facebook ID.

All of this makes it easy to publish and discuss all the things you do — the books you read, the clothes you buy, the movies you see — on Facebook and off. All these things you "share" help connect you to your friends, but more importantly, they connect you to advertisers. That's not a bad thing, necessarily. But you need to be aware of it.

Advertising is the essence of Facebook's business; it's the great and shining hope of that company and social media in general. Maybe even all media. But so far, it's not exactly justifying valuations. There has been loads of investment coming in, but not much real, sustainable revenue coming out. That's why the company is working so hard to add all the new sharing/connecting/movement features: to make advertising work the way it should on a social network.

At Fortune's Brainstorm Conference earlier this week, Facebook COO Sheryl Sandberg said the privately held company isn't feeling any pressure from its investors to produce profits yet, but she pointed out the obvious: that Facebook's real potential was in the "unusual and extraordinary opportunity" afforded by advertising. What she's talking about is inserting brand advertising into the shared experiences of Facebook's users. And the only kind of movement that is, is the movement of money.