MARKET WATCH -- Oct 27 -- Apparently, about 4 million college students across the country are "facebooking" their classmates, whether to connect with them or just get more information about them. News Corp and Viacom have shown interest in meeting with young Mark Zuckerberg, the 21-year-old Harvard dropout who started Facebook in his dorm in February 2004, and came into MarketWatch's San Francisco TV studios recently for an interview. Zuckerberg started the Facebook - essentially an online student directory -- while he was a sophomore at Harvard. The psychology major tells me that it took about 10 days -- during finals -- for him to build the site. He decided to take a leave from Harvard his junior year and move to Palo Alto, Calif. In the fall of 2004 former-PayPal-CEO-turned-hedge-fund-manager-and-angel-investor Peter Thiel -- whose fund is up 60%-plus this year -- gave Zuckerberg $500,000 to buy servers to support the growing audience base at Facebook. By 2005 Zuckerberg had raised $12.7 million, with Accel Partners leading the VC funding round with a valuation of about $100 million. Zuckerberg told me that the fee site is profitable and makes money from advertising (8.5 million uniques). Users spend more time on Facebook than MySpace. ~70% of the nearly 5 million registered users log on daily. Zuckerburg met with Chris DeWolfe, MySpace CEO who saw the selling of his company to a big media company as a natural progression. (I heard the next step for DeWolfe is to launch a MySpace music label with Interscope Records.) Zuckerberg doesn't agree entirely, stating that technology and engineering should be considered a big priority at today's media companies. "What drives the site is an offline dynamic and culture around it." What he means is that the Facebook communities revolve around a particular school. He can walk out into the school grounds and see everyone he knows in the Facebook. If Friendster is any guide, it's difficult to maintain a lead in this rapidly changing media business. What happens when the Facebook saturates the 8 million college-student market?
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Mark Brooks: As TV struggles to keep it's younger audiences hitched, advertisers will seek out the likes of Facebook for advertising. This will become an ever more valuable property as it penetrates the most valuable segment of the younger demographics; college bound youngsters and alumni. What irks me is that I worked on hooking up the UC system with an early version of Plaxo in 2000; 'eturn' was set on becoming a self updating address book for the masses. Alas, eturn, Planetall, DigitalMe, Swifttouch and Contact.com all headed south in the dotcom crash.