Facebook: Where a Minnow Can Look Like a Whale

[Geee]

American Spectator:

An auditor visiting Earth from another planet might be gobsmacked at what our society considers to have economic value. Indeed, the nearly $100 billion envisioned IPO of Facebook could capture the attention of an inquisitive stranger from a distant galaxy, causing him to wonder not only about capital formation, but about social values. With that valuation, the upstart social media enterprise would suddenly be about equal to Abbott Laboratories or Citigroup in value, with only 26 of the Fortune 500 having greater market capitalization.

The need to communicate is as old as homo sapiens. Since the Stone Age, our species has needed to reach out and touch others. Hirsute, carnivorous prehistoric Man may have felt loneliness in his own way, hoping to relate socially in caves and at campfires. Much later and over the centuries, inventions such as the printing press, telegraph, and telephone permitted more widespread social interaction. And now, at the outset of the 21st century, the art of communication is made even easier.

The expected valuation of Facebook shows how powerful is the human desire to liaise and interface. Once the hype quiets down, it may be worthwhile to ponder why a huge array of software, servers, and electrons traveling at the speed of light could be worth so much, while other American companies in basic industries are imperiled by competition and loss of market share. Why is it that smart, young geeks can suddenly become so rich, while those smart, tried and true folks who work hard and retire to bed early struggle for economic stability and fulfillment?

A principal value proposition of Facebook is to allow the shy to assert themselves. A socially awkward person can blossom into a digital socialite, with a few clicks of a mouse. Where else can a minnow look like a whale, a solitary extremist look like the Chinese Army, and a clumsy person look like a tango instructor? Indeed, phalanxes of the social hermits of yesterday now sit mightily in their comfortable high tech enclaves, the bland, light gray cubicles that Dilbert championed. Some even manage to eat several meals a day there. Facebook is their triumph and confirmation that intellectual capital is worth as much or more than time honored physical capital formed the old-fashioned way -- with distribution having enormous potential for advertising revenue. And so one generation trumps another.