• Ad Age, Monday, July 9, 2007 12:53 PM

Forget Microsoft. Google's biggest competition these days comes from the social media growth machine, Facebook. Google may have an "operating system for search" and a big bank of data about each of its users, but the future belongs to the masses of individuals -- and Facebook, the second-largest social network on the Web, knows comparatively more about each of its users.

Google should be scared because facebook is growing at a stunning rate--it has nearly 30 million users now--with no signs of stopping. This, in part, is thanks to founder and CEO Michael Zuckerberg's bold decision to open up his social network to outside developers. AThat move ran counter to the prevailing ethic at rival MySpace, which has been scooping up application-development companies in an effort to stave off competition from third-party software developers on its site.

Meanwhile, Facebook has shunned acquisition approaches right and left, as Zuckerberg believes that remaining independent is key to the company's future. Some speculate that an IPO could be forthcoming. But where do the futures of Google and Facebook coincide? When you think about personalized search or peer recommendations, areas that Google is aggressively moving into, you begin to see how these features are more meaningful when they're based on the actions of people you know. Viral distribution is the most powerful form of marketing and promotion; the potential is huge, and Facebook might have the upper hand.

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