Making this comparison almost feels dirty to me. I mean, radio is the down trending mass medium. Facebook is the new media frontier.

Radio is notoriously behind when it comes to the incorporation of social trends. I first sold commercial radio advertising in 1995 and, at that time, my company had a policy against having any kind of radio station website caused by fears of hackers opening HR files and on-air inventory status. Maybe it was a fear leftover from one too many viewings of Matthew Broderick in War Games. I digress. Nevertheless, radio has a long history of generating revenues.

One local radio station in Minneapolis/St. Paul estimates revenues at $1MM annually for sales of advertising programs on their website. Site traffic was estimated by one source at 100,000 uniques per month. Compete.com estimated their recent peak monthly traffic at closer to 20,000 per month. For the sake of conservative estimates, let's average those two figures – 60,000 uniques/month.

Minneapolis/St. Paul Radio Station Website Advertising Revenue

$1MM Annual revenue from internet advertising sales / 12 Months = $83,333/month

$83,333 per month / 60,000 unique visitors per month = $1.38 per user per month

Facebook Revenues

Estimated Facebook revenues for 2008 are $300 MM - $350 MM according to WSJ interview with Mark Zuckerberg posted January 31, 2008.

Compete.com estimates monthly Facebook uniques to hover near 30 MM.

Using the same calculations as above:

$350 MM projected 2008 annual sales / 12 Months = $29.2 MM/ month

$29.2 MM / 30 MM unique visitors per month = $0.97 per user per month

If Facebook could earn the same $1.38 per user per month as this one radio station their annual revenues would reach an estimated $496.8 MM. While half a billion dollars in revenue may not justify a $15 Billion valuation – it is a step in the right direction.

Fortunately for Facebook and MySpace, advertising dollars are moving toward the internet as opposed to the reverse for radio. Social sites still face their own problems – commoditization. As these sites start to compete with each other they will face the same pitfall that has helped to slow or reverse the growth of advertising revenue on the radio. Radio stations are notorious for cannibalizing each other rather than trying to hunt down dollars from other media types.

If Facebook was not in need to justify their massive valuation, I'd say that they should take a lesson from the guy that can turn 60,000 monthly pairs of eyes into $1MM. Instead, a new volume needs to be written.