Widgets help make Facebook the most valuable turf on the internet

You've probably become used to the animated ads that show up on web pages such as ours. If you build your own web site, or use MySpace (News Corp, NYSE: NWS), or Google's (NASDAQ: GOOG) iGoogle Home Page, or My AOL (Time Warner, NYSE: TWX), you may have grabbed some useful miniprograms that allow you to imbed a clock, a stock ticker, a weather report, or headlines from a variety of web sites and feeds. These mini-programs are called widgets, and they are the hottest topic on the 2007 internet marketing scene.

Widgets offer internet page builders a good deal, providing interesting content, updated frequently, to make the web page more appealing. In return, the web page host allows them to add a bit of advertising.

The upside for advertisers is that this allows them to spread their brand across millions of sites without paying for the placement. The downside for consumers is that widgets slow load times and clutter the content. The downside for sites dependent on advertising revenue (such as ours) is that when so many people are giving it away free, it's harder to sell advertising.

The most important aspect of widgets, though, is that they allow the user to create her own newspaper-like home page, with bricks containing the feeds she follows in the layout she prefers. No longer does she need to browse the web; instead, widgets bring the web to her.

Therefore, in a widget world, the most important turf is the visitor's home page. A Facebook user, for example, can load widgets in his page that bring his favorite content to him. No longer will those sites enjoy the ad revenue from his site visits, but are reduced to what they can pack into their widget.

In a widget world, Facebook, with over 30 million regular users and growing exponentially, could be the most valuable turf on the internet. If, as Tom Taulli speculates, it is about to go on the market, we could be looking at Google-like valuation at the time of its IPO.