Prepare for a new internet revolution JAMES KIRBY March 21, 2010
IT'S official the social networking website Facebook is now bigger than search engine site Google, and it's happened - as if pre-ordained by some cyberspace god - as we rolled towards the 10th anniversary of the dotcom crash.
Facebook's rise is an historic statistic that's literally going to change the world - an internet development equivalent to the day air travel overtook shipping traffic or television surpassed cinema.
Exactly 10 years ago the ''dotcom boom'', which involved investors wasting fortunes on over-rated technology stocks, came to a sudden end. In the US on March 13, 2000, the NASDAQ began a dramatic plunge from a peak of 5048. Even now - at 2391 - it is still trading at less than half that decade-old record.
But the failures on the stockmarket - and let's ring the bell for those forgotten names of the Australian dot.com crash: One.Tel, Liberty One, Davnet, Isis - did not stop the internet revolution.
Today there are an estimated 18 million websites and until recently Google was the undisputed king of them all but no longer.
A few days ago it was revealed that on the week to March 13 (in the US) Google received 7.03 per cent of all internet traffic and Facebook, which has been growing like crazy in recent months, hit 7.07 per cent - a year ago Google had 6.4 per cent and Facebook 2.5 per cent.
As Michael Walmsley, general manager of internet measurement company Experian Hitwise explains, "Facebook has already beaten Google occasionally on non-work days such as Christmas - but this was the first time it beat Google over the course of an entire week."
The sudden supremacy of Facebook has not happened in Australia yet but it's coming. A closer look at the numbers in Australia shows that at the start of the year the social networking category (dominated by Facebook) overtook the search category (dominated by Google). Social networking are sites where users share information with friends, while search engines are sites where users primarily find information from random sources.
What this changed web traffic pattern really means is that the internet is entering it's next big phase - and it's not a planned industry initiative such as web 2.0 or any other scheme dreamed up in the bowels of Microsoft or Hewlett Packard, but a change in the way we use the internet from a tool to ''find stuff'' to a tool to ''find each other''.
And just as Google beat off rivals in the search game - Facebook has left early rivals such as MySpace for dead.
For business, the change means social networking sites must now be harnessed - one of the fastest growing US media outlets, the New York-based Huffington Post, recently attributed its growth to how ''Facebook friendly'' it had become.
Recruitment executives increasingly use specialist sites such as professional networking site LinkedIn to fill vacancies; toy empires such as Disney watch children's networking sites such as Moshi Monsters to capture new markets.
In common with the early days of ''search'', we can expect investment success may come to the ''second wave'', the companies that execute best within a strictly defined category. On the ASX this has meant success for sites such as Carsales (motor trade), Seek (recruitment), Realestate.com (residential property), Wotif (travel booking) and Webjet (airline tickets).
The era of social networking will mean the rise of listed companies that exploit social networking, the ones that are ''Facebook friendly''; they're not obvious yet, but you won't have to wait another 10 years to find out the winners.
