Facebook: The "Second Internet"

Wired contributing editor Fred Vogelstein has penned another excellent story about the future of the Internet—this time about Facebook founder Mark "I'm CEO ... bitch" Zuckerberg's confidence that he can unseat Google (GOOG) as the dominant force in Web navigation, search advertising, and online activity. "Google is not representative of the future of technology in any way," one Facebook honcho told him. "It almost doesn't make sense to compare them."

After detailing a juicy scene in which Google co-founder Larry Page learns Facebook had just humiliated him in investment negotiations with Microsoft (MSFT), Vogelstein gets down to the core of Zuckerberg's grand scheme. Right now, most people use computers to learn about the world through Google spybots and algorithms. But people really want to learn about the world through their friends. The members of their Facebook social networks share their values and politics and tastes, and they will always prefer their friends' recommendations for food, interesting news stories, travel agencies, et al., over some software code that is trolling the Internet. "Why settle for articles about the Chrysler bankruptcy that the Google News algorithm recommends when you can read what your friends suggest?" Vogelstein asks.

Over time, Facebook is slowly building more and more information, contributed collectively by all of our Facebook friends: 850 million photographs, 8 million videos, and 4 billion bits of information (news links, comments, etc.) every month. Google can't search any of it. But Facebook can. And thanks to new deals cut with partners such as Digg, you don't even have to be on Facebook to find out what stories your friends have posted about Iran, or what they've written on Gawker comment threads.

Eventually, this will lead to each one of us assembling an aggregate profile of who we are, what we like, where we live, what our favorite holidays are—all sorts of personal information that Google's algorithms can't read. The company that is organizing all the information in the universe is locked out of some of the most critical information on the Web: the behavioral and consumption patterns of hundreds of millions of people—people that advertisers are slavering to pitch goodies at.

So far, however, Facebook has run into outraged consumer revolts whenever it has tried to use this data to help companies sell targeted ads at its members. Targeted advertising is potentially the most lucrative cash cow in the online world, but every time Facebook tries to monetize this information, its own members find it creepy and off-putting. And Facebook has to pull back.

Can Facebook supplant Google as the master of the online universe? Will it matter if it can't sell any ads along the way? We're not saying you'll find out if you read the whole story, but there's a lot more to Vogelstein's superlative piece, and we highly recommend you give it your full attention. Read past the jumps and everything; you won't be sorry.