Whichever way you look at it, 2010 was a spectacular year for Facebook. In America, it overtook Google to become the most visited website; globally, it's the third-largest website, behind Microsoft and Google. Its founder and chief executive, Mark Zuckerberg, was Time magazine's Person of the Year. Over the new year weekend, Facebook users uploaded 750 million photos. That's more than one picture for each user of the site, which now has a membership of well over 500 million people.
And this week it was announced that Goldman Sachs will invest $450 million (Dh1.65 billion) in Facebook. Then consider the fact that Facebook is still growing — at the rate of 700,000 people a day. It's closing in on 600 million users, and as more join, the network becomes more powerful. Its members aren't just chatting and sharing photos, they are also playing games, reading the news and keeping up with famous people. Facebook Places lets them share their location with friends; Facebook Messages aims to replace our email accounts; and the Facebook experience is now available on more than two million websites.
At the heart of this is Mark Zuckerberg, the 26-year-old Harvard dropout who has become the world's youngest billionaire. His motivation seems to be to drive Facebook forward — and his success is staggering.
Profiling him last month, Time noted that in addition to his expertise as a computer programmer, Zuckerberg "understands a remarkable amount about other people". His mother was a psychiatrist and he studied some psychology at Harvard. There is a team of very smart people around him.
But even with the social networking "think tank" that Facebook has established at its headquarters, it's Zuckerberg who remains the leader. Achieving long-term success on the web has always been a difficult business. A few companies have made it, notably Google and Amazon, but many more have gone from strength to obscurity in a surprisingly short time. When tech giants fall, they fall quickly. Facebook could suffer the same fate, but it doesn't look likely.
The site strikes a perfect balance between offering an experience that is relatively flexible while also being tightly controlled. It's a tightrope the site walks very well. Facebook is more than just a website; it's a mini-version of the web. Just as Google dominated the past decade, so Facebook could dominate the coming one. The difference between Facebook and Google is that the latter was only ever a starting point. Facebook is, for many users, the starting point and the destination.
However, the tide is turning, with fears about privacy on the rise. At the New Year's Eve party I went to, the response to camera flashes could be heard over the din. "Can we all agree," one girl yelled, "that no one puts these photos on Facebook?" For young Facebook users, that is the greatest concern: lack of privacy.
While developers quietly delve into your likes and dislikes, all you need to do is post a goofy picture online and before long your trendiest aunt (it was too rude not to accept her "friend request") has emailed it to your parents. Worse still, a friend from work could spot it — and suddenly, a photo lands you in serious trouble. At least among my friends, who are mostly professionals in their early twenties, Facebook now resembles a closed address book, hidden away in the internet's bottom drawer.
After Zuckerberg founded Facebook at Harvard, it spread, virus-like, around US university campuses, then to universities in Europe, and eastwards, eventually reaching villages in the rainforest and the bedrooms of Iranian dissidents. Now the trend seems to be happening in reverse, rippling out from the same epicentre.
I spoke to a former classmate of Zuckerberg's and asked if Harvard students use the site as much as they used to. "No, definitely not," he said. "Now Harvard students are much more worried about protecting, not sharing, their own data."
So Facebook continues to grow, but the tide seems to be turning. Enormous numbers of its 500 million "active users" could soon become dormant. They might spend an hour a day logged on to the site right now, but such saturation has "bubble" written all over it.
The company's commercial ambitions are also open to question. If Facebook decides to float, it may struggle to battle with other internet giants. There are doubts about whether social networks are the best place to advertise.
In a few years, Goldman's funding could be seen as Facebook's high-water mark, just as Rupert Murdoch's takeover of MySpace actually heralded its descent into terminal uncoolness. At any rate, for Mark Zuckerberg, this is the end of the beginning.
By Shane Richmond