Facebook expects a massive stock market valuation because it's a platform. But that's true only on the Web -- not in the mobile space.



NEW YORK (TheStreet) -- Facebook(:FB) says it deserves to be worth more than $100 billion because it's a platform.

But that's true only on the Web.

Like CompuServe, AOL(:AOL) and Yahoo!(:YHOO) before it, Facebook is a destination. It bids to become the whole Web for its users, and for its most loyal users it is. It is, after all, where their friends are. When you're seated behind a screen, Facebook may be your primary platform for interacting with the world.

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But when these friends leave their PCs and take up their Apple(:AAPL) iPhones, Facebook is, at best, an app. The phone itself is the platform. And Facebook has no control over the phone.

Apple controls the phone. Its policies and financial demands are behind any company's interaction with customers on the iPhone. Whatever they do, whatever they sell, Apple takes its cut.

That's why so many recent Facebook acquisitions are in the mobile space: Strobe; Tagtile; Instagram; and, most recently, Lightbox which makes a photo-sharing app for phones using Google's(:GOOG) Android operating system.

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But no matter how many of these companies Facebook buys, and no matter the merits of each acquisition, what Facebook is still left with is a collection of apps. You don't go to Facebook and then use that platform to get Instagram for your mobile phone. You get Instagram for your mobile phone.

This is a big part of the problem with any destination business model. You may become the biggest destination on a platform, but when the platform changes, you have to start all over again.

To even run something as simple as an app center, you have to, in essence, compete with the platform.

Facebook could "solve" this problem by bringing out its own phone, maybe an Android-based phone. But that's entering another business, a huge business where it would be a small fish in a big pond. What kind of market share could it hope to achieve? What would be its relationship with carriers? How could it maintain feature parity with Apple or Samsung?

These may seem like small, distant problems. But when you're telling the market you're worth $100 billion or more, you're saying you're as big as Verizon(:VZ). That you're bigger than Amazon.com(:AMZN). How can you be, when you lack their control of the customer? How can you be, when you don't control the platform?

Now I have no doubt that Facebook's IPO will sell out. Barely 10% of the company is being offered. The brokers will make certain there's the appearance of a huge crowd seeking shares, that there's a "pop" at the open leading to a belief that all the shares are worth what they're trading for. That's the brokers' job.

But after the IPO, the problems I've just discussed will remain. After the IPO, the move of Facebook's customer base to mobile platforms, and Facebook's inability to control those platforms, will become a bigger issue. And the fate of the company, and its stock, will depend on finding an answer to it.