Facebook Turns a Profit, Triples Members

While you were posting vacation photos and messaging your friends, Facebook just became the world?s fourth largest ?nation.?

While you were posting vacation photos and messaging your friends, Facebook just became the world's fourth largest "nation."

Pause for a moment to consider that fact. In the last year, Facebook, the social networking site to which you likely already belong, has seen its membership rolls triple in the last year to a total of 300 million members. And if those trends are continuing, Facebook today will add another 3 million members -- that is, the population of a city the size of Berlin, Madrid or Buenos Aires.

VIDEO: The social networking site made more money than expected in the last quarter.
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Three hundred million members is a mind-boggling number. In terms of population, it would put Facebook on the list only behind China, India and the United States -- and just beyond Indonesia, Brazil and Pakistan. It is almost as big as the entire population of the European Union, of sub-Saharan Africa, or South America. And, incredibly, it is equal to the entire population of the world in the year 1000.

Facebook, of course, isn't really a sovereign nation. Still, one could make the case that at least to millions of young people who visit the site a dozen or more times per day, take their cultural cues from the site, use it as their communications infrastructure to their social groups, and define their self-worth by how they are rated by others on the site -- it is has become a de facto, virtual second country to which they owe a special kind of allegiance.

The cultural side of technology revolutions have a tendency to sneak up on us. We see the tech, of course, but technology by its very nature tends to be personalized, i.e. mass customizable. When you shop on eBay for that special piece of 19th century Limoges china or original "Beatles for Sale" LP, the experience is intentionally intimate and personal. You discover that there are four items for sale, offered at different prices by four different sellers. It is all, by design, the virtual version of walking up to four vendors at a flea market. Only if you look closely do you realize those four sellers are scattered across North America, perhaps even the world.

But even if you notice that astonishing geographic scope, it is unlikely that, viscerally, you also appreciate the fact that beyond your little online room where this transaction is taking place, there are literally millions of other little rooms where other transactions like yours also are taking place at this very moment.

That there are whole regions of eBay -- vast sub-markets selling parts for 1960s manufacturing process control equipment, for example -- that you know nothing about, will never visit, yet are the heart of entire multi-million dollar industries.

These areas are invisible to you because (unlike the natural world) you don't have to pass through them -- like the furniture department at Wal-Mart on the way to the stereo department -- to get to where you are going; because the human brain can't encompass all of these millions of items in thousands of categories, and because you don't have even enough expertise in those arcane fields to know the right terms to search for.

This interesting cognitive phenomenon is what underlies the so-called Metcalfe's Law. No one has yet come up with a precise definition of the law, but everyone knows that it's true. Here's the standard formulation: The value of a network is proportional to the square of the number of connected users. Put simply: The more people use a network, the whole lot more that network is worth to them.

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