The next generation of Facebook: Paybook?

If you are one of Facebook's estimated 300 million users, chances are that you are already familiar with many of the site's free features. Recently, however, the company announced the development of an internal payment system that will make it easy to pay for games, buy virtual goods, and perhaps even do real shopping.

In some ways, this represents a major departure for Facebook. On its base level, the site is essentially an online version of the phone book, enabling users to connect and keep in touch with friends, colleagues, and family members. Even education histories, addresses, and employment information, which the site encourages members to post, basically facilitates a broader range of searches. In the process, it takes traditional directories to a completely new level.

The thing is, while there are a few "Rain Men" who read phonebooks for pleasure, most people only pull them out when they need to look up a number. In order to make Facebook "sticky" and ensure that users stay for a while, the site has millions of fun, time-consuming applications. From browsing friends' photos to taking random quizzes, to playing wordgames, Facebook is designed to be a massive time-suck. In the process, it sells a lot of ads; in fact, some sources have pegged the site's current revenues at approximately $500 million.

Still, Facebook doesn't draw any money from the flow of users on the site or from their connection to various applications. In fact, this is a large part of why it is so popular: by offering a free, relatively safe place for users to connect and congregate, it provides a service that is somewhat unique. Unlike other sites that appeal to specific subgroups and encourage specific activities, Facebook draws a wide range of patrons, from people who have skeleton profiles up for connectivity purposes to users who spend hours online each day.

However, while Facebook is running on ad revenues, some of the development companies that use the site are making millions of dollars from selling games and virtual goods. Payment is a somewhat circuitous process, involving third-party companies and applications that users employ as needed. Consequently, although the site could easily be a hub for buying, selling, and trading, commerce on Facebook is currently somewhat stunted.

If Facebook can create a payment system that is easy to use, easy to refill, and inexpensive, it could change the way that many of us do business.

In the beginning, it would largely be a tool for buying plants on "Lil' Green Spaces" or purchasing virtual sheep to hurl at friends. However, with Facebook's wide customer base and connection to so many businesses, its financial system could be a good resource for paying for auctions and other purchases. It's not hard to imagine a future in which Amazon e-books, iTunes songs, videos, and online Wall Street Journal articles could be purchased with a simple click on a Facebook icon.