Is facebook worth $15 billion?

The business development folks at my old employer, Microsoft, seem to think so:

The two companies said on Wednesday that Microsoft would pay $240 million for a 1.6 percent stake in Facebook. The investment values Facebook, which is three and a half years old and will bring in about $150 million in revenue this year, at $15 billion.

The deal throws the value of the holdings of Facebook investors into the stratosphere. Mark Zuckerberg, the 23-year-old Facebook founder who followed the path of Bill Gates by dropping out of Harvard to build a company, owns a 20 percent share that may now be worth as much as $3 billion. Accel Partners, the venture capital firm that invested $12.7 million in May 2005, now holds stock that could be worth $1.65 billion.

Color me skeptical. I know Facebook is the flavor of the month right now. But these networking sites seem to fall victim to fashion trends pretty quickly. First it was Friendster, then Tribe, then MySpace, etc. The article talks about how invested some community members are in these sites, and how they've dominated certain geographical regions:

“Once a social operating system takes over a country, it’s like it becomes the native language of that country,” said Lee Lorenzen, a venture capitalist who has invested in companies making Facebook applications. Mr. Lorenzen noted that Google’s Orkut dominates Brazil, Friendster dominates the Philippines and Facebook is becoming the dominant forum in the United States, Canada and Western Europe.

But how deep can this dominance be, given that all of these sites are relatively new? I do think that allowing Facebook users to develop applications for that platform is a good idea, as it binds people to that platform and gets them more invested in it. But is it a $15 billion dollar good idea? I think dot com irrationality is coming back. Which of course means it's a great time for me to be getting back into the computer games business!