• Business Week, Thursday, August 23, 2007 11 AM

Third-party software development on Facebook is booming, but are application makers making any money? Where is the business model? Advertising is the logical choice, but even the most interesting Facebook applications are attracting small audiences.

For many companies, like Fantasy Stock Exchange, Facebook is treated more like a marketing tool than new business tool. However, there's no reason you shouldn't go right to HedgeStop.com (the developer) to participate in the fantasy stock market. What's the benefit on Facebook? Also, HedgeStop hopes to make money selling banner ads-but who would buy 92,000 users who are most likely novice traders?

Jobster.com, a career networking site, wants users to post their resumes and career goals to their Facebook pages, and then send that information to employers like Nike, GE, and Merrill Lynch, which pay $100 per month to access resumes from Facebook. That's in addition to the $300 they pay for access to Jobster.com. This is a much smarter business model, because job hunters know they're getting in front of a younger audience, where they can access a significant amount of personal information.

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