Adding a social networking layer to the music listening experience makes sense, of course. Unlike other music services, which have attempted to graft a social element on top of a music offering (think Apple with Ping), Facebook is starting with social and adding music. Facebook already integrated with Spotify – now it wants to partner with other online music services as part of a music dashboard. As the latest Web sensation Turntable.fm taught everybody, the process of listening to music is inherently social. Who doesn’t prefer to be DJ’ing when their friends are in the room with them?
The simple act of combining the “social” layer with the music listening experience immediately increases Facebook’s pre-IPO valuation. You do the math – if Internet radio company Pandora could be valued at $2 billion, just how much is Facebook Music worth?
However, you could just as easily claim that the hottest IPOs of the year have really just been “old media” in social media disguise. Groupon? Coupons for the Web. Pandora? Internet Radio. LinkedIn? A Web-enhanced Rolodex. Now, here comes Facebook, re-inventing itself as the Tower Records of the social media age.
The upcoming F8 ("Fate") developers conference in August could determine the future of Facebook's music aspirations. Is the company fated to become the next MySpace, where people go to discover bands and music and hang out with Tila Tequila, or a true cross-platform digital pioneer, capable of beating Apple at its own game, by creating a real-time, social experience accessible across every mobile device? Just keep in mind - you don't get to 500 million tunes sold without making a few enemies.