Campus massacre puts spotlight on FaceBook

At a moment of great trauma, the students of Virginia Tech - and a wider world of horrified onlookers - have turned to the social networks of the internet to connect, to share their grief, to remember victims, to offer prayers and to debate.

Responses to the massacre by a generation of youngsters have underscored, as if it needed it, just how communications have been revolutionised by websites such as Facebook and MySpace, and how quickly these operations have woven themselves into the lives of people on campus and further afield. Neither Facebook, nor MySpace existed four years ago; today they are indispensable.

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It is the connections made on Facebook which have been particularly striking in the days after the tragedy in Blacksburg. The website was created as a forum for university students to post profiles, write blogs and message other members of their university, and has grown to encompass about 19 million members across the world.

It was extended to allow university alumni and high school students and, most recently, has been thrown open to the public. But it turns out that it is not the breadth of the network that is the most impressive here - it is the depth.

Virginia Tech students instinctively turned to Facebook to check their friends were alright and to reassure wider acquaintances and family that they too were safe. Mobile phone footage and pictures of the unfolding events appearing on the site are a new example of the "citizen journalism" transforming the news media. Facebook users have created dozens of groups sharing messages and reflecting on events. And the Facebook pages of the dead have become online shrines.

These are hugely important phenomena for the way media fits into people's lives, and hugely important therefore for the media industry, which is struggling to adapt to the explosive use of the internet among the young, which has been dragging them away from television and other traditional media.

Facebook's founder, the Harvard drop-out Mark Zuckerburg, caused astonishment when, last year, he turned down a takeover offer from Yahoo! that would have valued it at more than $1bn (£500m), and possibly as much as $1.6bn.

Mr Zuckerburg is 22 . He grew up in Westchester County, New York, the son of a psychologist and a dentist, and he began computer programming before his teens. He created Facebook as a project at Harvard in February 2004, and saw it take off at other Ivy League institutions and then beyond so that it now employs 200 people in Silicon Valley. His business cards used to say: "I'm CEO... bitch."

Commentators joked that perhaps he didn't want to have to stop wearing his trademark t-shirt and sandals to the office. Others warned he would regret it - he should have taken advantage of the hot-house valuations of internet firms that would have seen him net at least $300m for his stake and won a significant return for his business angle and private equity backers.

Few seriously considered the other possibility - that Facebook is, or eventually will be, worth more.

Facebook is the second social networking site in the US behind MySpace, which had 53 million individual visitors in February, according to Nielsen/NetRatings. Facebook, with 10 million visitors, is growing at 110 per cent annually, compared to 60 per cent for MySpace.

Rupert Murdoch's News Corp bought MySpace for $580m in 2005 and last year signed a deal guaranteeing it $900m in advertising revenue from Google, which will place ads next to the results of users' search queries. Mr Murdoch's judgment had been questioned at the time, since MySpace - like Facebook now - was bringing in only modest revenues. Not so now.

In a recent report, Doug Mitchelson, analyst at Deutsche Bank, said that News Corp had shown its confidence in MySpace by lifting the veil on revenues at the business. "MySpace revenue in the second quarter was approximately $75m - up 200 per cent, year on year - especially impressive when one considers that revenue from the Google deal has not started to accumulate. With this news, concerns that News Corp would struggle to monetize its robust MySpace (now the most viewed page on the internet) will be significantly reduced."

The social networking phenomenon is new. Businesses are still working out ways to advertise and generate revenues from the communities that are being created, and sceptics fear that, like a trendy nightclub, their visitors could drift off to the next big buzz in quite a short space of time.

But we are starting to see the depth of the communities that are being created.

There is time.