Peter Thiel believes Facebook more valuable than Google

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Google and Facebook are engaged in a fierce rivalry for internet dominance. While there is room for both, it seems that one or other of these giant companies will eventually emerge as the leader. Google has the advantage of being the older, more established company. Facebook, however, has rapidly become the world’s largest social network by far, with well over a billion members worldwide. What will the future hold for Google and Facebook and which is destined to become the leader?

Peter Thiel’s Theory

Peter Thiel

Peter Thiel, a Facebook board member, recently put forth an interesting theory of why he predicts Facebook is more valuable than Google (audio around the 58 minute mark). Naturally, Thiel’s opinion is a biased one. If you asked someone from Google the same question, you would get a very different answer. Still, Thiel raises some points that are worth considering.

According to Thiel, what differentiates Facebook from Google is the human factor. Google is a search engine that deals primarily with data. Facebook, on the other hand, is a social network that’s all about people. So Thiel believes that Facebook will ultimately be more important and relevant simply because it favors people over data. This is, admittedly, a simplistic argument. Both Google and Facebook, after all, deal with both people and data. On the other hand, the huge growth of Facebook in recent years, and the different way people interact with the two companies suggests that Thiel may have a valid point.

Google vs. Facebook: What Are the Differences?

While Google, at this point, is in no danger of being rendered obsolete by Facebook, Thiel’s comments have some relevance about the way people use these services. Most internet users do Google searches on a daily basis, but this is mainly in order to gain information of one kind or another. If a more useful or efficient way to mine data came along, people would not hesitate to abandon Google.

When it comes to Facebook and other social networks, on the other hand, people join and participate because their friends are also there. This is not to say that people have blind loyalty to Facebook. Indeed, there has been something of a Facebook backlash lately due to issues such as privacy. However, the fact that so many people use this social media site gives it a certain addictive appeal. People may have mixed feelings about Facebook, but they are hooked on it. With Google, the interaction is much less personal.

Which Company is More Valuable?

The value of a company is based on many factors. In the past, value was mostly tied to profits. In the digital age, however, it’s become much more complicated. Facebook, for example, is a profitable company but most of its perceived value lies in its potential. The same is true for Google, which has recently been investing in a wide assortment of ventures, including medical technologies and robotics.

Only the future will determine whether Google or Facebook will ultimately be more valuable. Both companies must carefully watch not only each other, but also other competitors who are anxious to become the next internet giant.

James Vrionis

James Vrionis knows Technology and is Based in the Palm Desert Area. Contact him at jvrionis@investcorrectly.com

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