Are teens spending less time on Facebook?  Likely.  Ultimately, the problem with being the latest shiny toy in techland is that eventually a shinier toy comes along.  That, in a nutshell, is the dark cloud looming over Mark Zuckerberg’s Facebook: if it’s not Twitter, it’s Instagram. Tomorrow, it could be Crapstr.

Now don’t get me wrong, for all intents and purposes, Facebook is a juggernaut and will remain one. There are more people on Facebook than there were people on earth a mere 200 years ago (the world crossed one billion people in 1804, in case you’re wondering). But as a fellow media-focused VC likes to remind me, despite having a billion users, Facebook’s revenue just ain’t all that (relative to the only company that matters, really, and that being Google).

So long as Facebook shows a disregard of privacy and user rights, then Facebook credits/payments will underperform (do you really want your entire social network being aware of every purchase you make?).  So with Facebook’s current advertising model and products being what it is, I suspect Facebook’s advertising business will continue to underwhelm Zuckerberg’s own ambitions, let alone Wall Street’s.

After all, at a time when first, Google buys YouTube (and Zagat!) and underwrites $100 million worth of video programming; second, Hulu/Netflix dive into content production; and  third, even Intel sees a holy grail in programming,  Facebook’s reluctance to develop an internal media (and eventually, content) strategy will make it fall further and further away from its potential.  Facebook could conceivably one day have a profile of every man and woman with a Web connection, but its revenue per user will shrink to marginal levels because of its misguided belief that advertising can ever truly go on auto-pilot mode, or that social advertising is some kind of silver bullet that provides efficiencies over the most effective form of advertising ever, search.  Even Google got religion and hired salespeople, bought YouTube, underwrote content.  But apparently, Facebook knows something that Google doesn’t: the last time someone bet so big and so ill-advisedly on the “algorithm” was Barry Diller and  The only winners there were billboard ad salesmen.

Ok, now it’s Google’s turn

This doesn’t mean that Google isn’t suffering from myopia, either.

In fact, the irony of Facebook and Google’s envy of one another is comedic if it wouldn’t be tragic.

On one side, you have Facebook so blinded by Google’s AdSense success, that the social network emulates Google’s YouTube strategy to grow video – -and thus branded — advertising.  Meanwhile, Google is so envious of Facebook’s social media mojo that it has put its weight – and, to some extent its credibility — behind Google Plus, when it has, in fact, the most valuable social network of all, YouTube.

Yeah, I said it

Facebook’s problem, ultimately, is that it’s a social network between people who just don’t have all that much in common (from an advertiser’s perspective).

Hear me out.

Yes, we’re related to our families, have gone to school with some people, work with others and what not, but when you distill those relationships, they’re actually rather superficial (ironically) to advertisers.  With YouTube, however, the bond between users is topical and based on the content we watch.  That is golden (again, to advertisers).

YouTube isn’t necessarily maximizing its advertising opportunity the right way, but it’s getting out of its own way and riding its size.  Google is definitely missing the social networking opportunity by chasing it via Google Plus instead of YouTube. But as long as Facebook keeps whiffing on content and media, YouTube will keep growing ,and Facebook will slip into the background while Google Plus fades into oblivion.