Facebook signed up its 100 millionth member last August and is expected to reach 200 million shortly, representing a staggering growth rate that has seen the numbers double in 8 months. This article by the New York Times reviews how Facebook has developed and the challenges it now faces to maintain this momentum and to maximise the potential revenue from this membership base.

Facebook has developed its own momentum as well as a passionate user base that has reacted poorly in recent months to proposed changes by the company to privacy controls and also the recent redesign of users' home page. It is also facing increasing competition from newer start-ups like Twitter, the micro-blogging service which is attracting current media focus, plus there will be a growing issue between the original users of Facebook - young, tech-savvy early adopters - who move away from the service as it attracts a wider (and older) user base.

The Sydney Morning Herald covers the launch of a new enhancement to Google's search results pages which have been based on a technology developed by an Australian. The new feature adds other suggested search phrases at the bottom of the results for a particular term and developed from work completed by Ori Allon, a PhD student at the University of New South Wales who is now employed by Google and working in the US.

Google’s new search results claim to “better understand associations and concepts related to your search”, and therefore to deliver a more meaningful search experience. This is achieved by integrating a new technology into the Google search infrastructure which displays related terms based on these concepts and associations related to the original search query.

Whether many people notice these changes and start to use the suggested links will be interesting to see, but Google hopes it will further increase the usage and loyalty of users by creating the best possible search experience.

Media Post comments on a new report from the the US by Borrell Associate that forecasts a tripling of spend by small and medium-sized businesses over the next 5 years due to local companies pouring more money into developing their websites and other online promotional activity.

The report says that whereas interactive ad spending across segments such as display, search and email will slow their pace of growth (by only 10% in the next five years to $7.5 billion), the level of non-ad spending on things like websites or online promotions and public relations will increase from 7.9% to 18.1% of interactive marketing budgets from 2008 to 2013.

On the advertising side, Borrell estimates that paid search will continue to be a key part of SMB spending while banner ads will give way to video. Meanwhile, standard format advertising, which currently accounts for 47% of all SMB interactive spending, will make up less than 19% by the end of 2013.

Google has announced a new feature for AdWords advertisers that will be launched as part of the third-party content network (AdSense). In addition to matching ads with the topic of a web page through contextual advertising, advertisers will now be able to reach users based on their interests, independent of the content they are currently reading.

With this new interest-based advertising - which is being introduced in beta for selected advertisers initially - companies will be able to advertise to users based on their previous interactions with them, such as visits to their website. A number of interest categories will be offered, such as "sports enthusiasts," so that targeting can be improved to drive brand awareness or increase advert responses.

Google has been looking to add this type of feature for some time, following the user-profile options offered by Microsoft's adCenter PPC tool in the US. This latter system is supported by Microsoft's network of user details from Hotmail or Messenger, whereas Google has been lacking that level of targeting data. However, Google is now developing a base of information on user habits and offers searchers the additional relevancy that interest-based ads can provide. Users can visit the new Ads Preferences Manager to see what interest categories Google thinks they might fall into, or they can add and remove categories themselves. This Ads Preferences Manager can be found by clicking on most "Ads by Google" links on ads throughout the web.

The question will be how many web searchers will provide their details or be comfortable with the privacy issues that drive this new service. Clearly more relevant advertising should be of interest to most people, but the ways of serving that up may not be so acceptable. Google's official blog has also posted an article explaining the new system and outlining how they are making the option transparent to users, in the hope that they will encourage a wider uptake of this service for the benefit of advertisers and web users.

According to new research by Nielsen, social networking has now overtaken e-mail as the most popular Internet activity. As reported by AdWeek, the active reach measure used by Nielsen's online panels shows that "member communities" now exceed e-mail participation by 67% to 65%. What's more, the reach of social networking and blogging venues is growing at twice the rate of other large drivers of Internet use such as portals, e-mail and search.

The Nielsen survey predicts that this shift to social activity online would have profound effects on marketers and publishers. For publishers, social networks are eating into time spent with other online activities and for advertisers, the rapid growth of this sector represents mostly unfulfilled promise for a deeper connection with consumers who are more difficult to reach in social environments.

The use of social media includes communication methods that are taking traffic away from the traditional portals and email hubs. Nielsen found that two-thirds of the world's Internet users visited a social networking site in 2008 and social media now accounts for almost 10% of Internet time. Facebook continues to lead the market worldwide, with monthly visits by three out of 10 Internet users in nine global markets monitored by Nielsen. This growth in social media is not confined to the U.S. as the report charts comparable or higher growth for Australia, Spain, Italy and the United Kingdom.

Advertising Age covers the story of a recent report published by Forrester Research that promotes the use of paid blogs, but has attracted the anger of Google who strongly discount this activity in terms of link benefit. According to Google's webmaster guidelines, paid blogs are akin to paid links and are not encouraged - in fact, Google wants such blogs to be disclosed as such and any outbound links should also carry the "no follow" tags that are now widely used by many Web 2.0 sites to discourage 'link spam'.

Following the release of the Forrester report, Matt Cutts, the head of Google's web-spam team, reiterated on his blog in no uncertain terms that those who fail to comply with Google's rules will face punishment, though he didn't state how the offenders would be punished. From Forrester's perspective, the author of the report said he would follow up with a blog post that deals with Google's demands, including spelling out the need to include "no follow" tags in paid blog entries.

There is of course some debate about how big companies are now using blogs and paying writers to post positive articles about their products or brands. The concern for Google is that this is another way to develop website links and also that the use of paid blog entries should be revealed. The argument is likley to continue for some time.

The BBC website has reported that the popular social networking site, Facebook, is coming under an increasing number of threats from hackers who are trying to obtain personal information about users of the site. Apparently there have been five separate security problems in the last seven days. The hackers are reported to be creating fake messages padded with details of Facebook members in the hope that they can obtain information and access to users' details by capitalising on the trust and social links that drive the network.

They are also taking advantage of the hundreds of applications that have been developed for Facebook's users, with one malicious application has tried to trick people into adding it by claiming that their friends were having trouble looking at their profile. If the application is added it spams itself to every Facebook friend that a member of the site has. So far, however, security experts say that these rogue applications have been scary and a nuisance more than anything else, but this remains a big concern for the operators of Facebook, and their millions of users.

Facebook had also been under attack from a virus with a new version of the 'Koobface' virus targeting members of the site again, with the previous attack at the end of last year. The new variant uses a Facebook message to try to get people to visit a fake YouTube page and install the malware. To make it look more plausible, the virus posts the image from a Facebook member's profile on the video page. Once installed the malicious program hunts for cookies on a victim's computer and uses the details it finds in the small text files to log into other social sites that person may be a member of.

The latest issue of the monthly Web Marketing newsletter has been published, covering some of the recent stories on web search and online marketing trends.

This month's edition looks at the latest figures on Internet advertising in Australia for the last quarter and for 2008, which still show impressive growth trends, particularly in search advertising. It also reviews the recent tests made by Yahoo! for a new format of PPC advert which integrates images or video. Finally, this edition covers the benefits to business websites of the Site Overlay function within Google Analytics.

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