Facebook is a $20 Billion night club.
As Facebook's "valuation" (a word that I always put in quotes) rose higher and higher, and people were talking about tens of billions of dollars, my thought has always been that it's not protectable. Facebook doesn't own your vegas pictures; they don't control where you stalk that girl you met last night, and they have no way of stocking whether or not that popular jock from high school is fat n' bald now.
I pled my case that Facebook would go the way of Friendster and MySpace, but people wouldn't hear it - those were "also-rans" and did so much wrong. Honestly, it was beginning to look like I was wrong. It happens (sometimes). Then, Google+ launched and I finally have the analogy I was looking for - night clubs.
Facebook, MySpace and Google+ are simply environments for socializing. That's it. They build a room, put some stuff in it that you like, and then invite you to come hang out with your friends and meet chicks. That's what a nightclub is too. Facebook is just a nightclub. It's a huge nightclub, but just a nightclub and anyone investing in it should look at it as such.
Now, ask someone who has built successful night clubs what the shelf-life is. How long is a specific club still the place to be? Two years? Five? Inevitably, no matter how cool the club is, or how loose the women, something new opens up and the kids move on.
So, would you buy a night club for $20 Billion?