Since its debut in the stock market, Facebook’s initial public offering (IPO), which raised $16 billion, has been losing steam. Although the IPO raised the value of Facebook to $104 billion, the price of the company’s stock has fallen 13-percent since Friday, leaving many to wonder if Facebook is more hype than substance.

The Associated Press reports:

The downward spiral has left some people sitting on big losses and others scratching their heads. After all, nothing fundamental has changed at Facebook in the days since the much-hyped company came to Nasdaq Stock Market with a ticker symbol of “FB.” Facebook still has more than 900 million users, its 28-year-old founder Mark Zuckerberg controls the company, and it is still one of the few profitable Internet companies to go public.

Facebook’s IPO — like Netscape’s in 1995 and Google’s in 2004 — was billed as a milestone moment. Netscape’s offering ushered in the era of the Internet browser. The company’s stock more than doubled in its first day of trading. Google’s IPO heralded the age of search. It posted an 18 percent gain in its stock market debut. Facebook was supposed to offer proof that social media is a viable business and more than a passing fad.

But investors don’t seem convinced. Facebook’s stock closed Monday at $34.03, down 11 percent from Friday’s closing price of $38.23. The investment banks that arranged Facebook’s offering set a price of $38 on Thursday. Although many investors had hoped for a big first-day pop, Facebook’s stock opened Friday at $42.05 and fluctuated between $45 and $38 throughout the day.

Although much of our lives happen on social networks like Facebook, it remains to be seen if the company will be able to turn large profits for investors or if it’s a passing fad like Myspace and Friendster.

Do you think Facebook is here to stay or just a passing fad?

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