I’m not very well versed with IPOs and the consequences of a falling share price, but I read today that what happened to FB will create issues for them in the short-term – of the corporate kind, such as big withholding tax bill for the shares it allocated to its employees, as well as staff retention problems and 2nd round share offerings (Business Insider article on Facebook).
I don’t think the end is near, but I think that people will increasingly move to platforms that do something useful for them (Apple just bought www.thefancy.com, which is Pinterest with an actual revenue generation model). In my opinion, Facebook’s big problem is that it relies on the old model of mass advertising, while the actual desire to get away from mass marketing is one of the first reasons people spend more time on the internet.
My take is that people who watch a lot of TV will stay on Facebook, while the rest of us with some sort of functioning brain will increasingly stay away from it. As long as the old advertising model works, Facebook will stay alive and continue to make zillions – and soon they’ll crack their mobile advertising issue and everything will be fine (they are currently making $1m a day with their sponsored stories only – imagine when they sort out their mobile conundrum for ads and brand pages).
The future of Facebook relies on its ability to become like TV: dumbified for the masses.
Facebook is well on its way to achieve this.