Seth Goldstein and David Henderson have teamed up with one of the leading Facebook application developers and launched SocialMedia: part widget developer, part widget hosting provider/ad network. Along with Lookery, the company is one of the first providers of monetization services for Facebook application developers — filling some of the vital Facebook Platform infrastructure gaps.

Goldstein and Henderson, internet advertising veterans (Goldstein founded Site Specific, one of the first internet ad agencies, in 1995 and Henderson was DoubleClick’s very first VP of Sales) who worked together more recently Root Markets, joined with David Gentzel, developer of the popular Trakzor application (widely adopted on MySpace and one of the earliest Facebook applications to achieve significant distribution), and Sourabh Niyogi, developer of Appsaholic, to reincarnate the former AttentionSoft as SocialMedia. The company now has teams in the US and India.

After Trakzor, which has 3,750,000 users on MySpace and 800,000 on Facebook, Gentzel and SocialMedia have released FoodFight, which has distribution of 1,750,000, and Happy Hour, which with 900,000 users in its first week has become one of the fastest growing apps on Facebook so far. Altogether, the SocialMedia network claims over 8 million app and widget installations across Facebook and MySpace.

The goal of SocialMedia, according to Henderson and Goldstein, is to develop a network of applications on multiple platforms. However, the company is also making an effort to recruit popular application creators in what to my knowledge is one of the most full-service approaches to application monetization yet. They will bring your app in house onto their servers (if you want), sell your ad inventory to top advertisers and agencies, and help you bake sponsored features into your application. The price? A hefty 50% commission, but hey, better than nothing if you’re a lone developer without cash to spend on servers.

Henderson is optimistic about the new opportunities social networks offer to advertisers. “Social networks offer new and better ways to market. Now, you can now integrate into social constructs and ride on friends’ recommendations rather than trying to market 1-to-1,” he told me recently.

As for the caution that some have recently expressed toward the potential of advertising on social networks? “Some folks are talking about Facebook like it’s ‘only good for customer acquisition,’ as if that’s no small feat,” Henderson said. “Without customer acquisition, you don’t have a business.”

[tags]facebook,widget,application,monetization[/tags]

So, you’ve written an awesome Facebook app and you think it’s going to take off. You get five users, submit it to the directory, and because your application works well and has no bugs it gets listed within a few hour. You have an idea of how fast you think it will grow, but you really need to know how fast it actually is growing.

Using Appaholic, you can create accurate models of your application’s growth. If you’re growing too slowly, you need to know so you can fix the problems that are keeping users away. If you’re growing too fast, you need to know so you can move the application to a host that can accommodate it. You’d also like to be able to set goals and know if you’re on track. Will I have 1.2 million users within two weeks?

I’m going to use Booze Mail as my example app and Excel to plot the data. First, go to Appaholic and navigate to your application’s page by entering its name or application ID in the left-hand input box. You will be taken to a page that displays various statistics about Booze Mail’s growth.

We’re going to be using the daily data because Excel doesn’t understand hourly time-based graphs. So, download the CSV (Daily) file from Appaholic and open it with Excel. Select the data you want to graph and click the “Chart Wizard” button. You don’t need to select the lines which have no user numbers — they correspond to the days before your app was listed in the directory.

Note: Make sure you only select date and number columns and not the column titles. Otherwise Excel won’t graph the data properly. In the Chart Wizard select the Line graph and click “next.” Customize your graph as you see fit and then click “finish.”

Now you have a nice graph in your spreadsheet. Right-click on one of the data points on the graph and select “Add Trendline…” Here you pick the curve you think best fits your graph. You will probably have to experiment to get the graph that fits best.

For Booze Mail I’m going to choose a third degree polynomial model. I don’t think is really accurate over the long run — I’d guess that most applications follow a logistic growth curve. But fitting logistic curves to data is beyond the scope of this article, so the third degree polynomial will have to do.

Finally, to get the trendline to extend in to the future click the “Options” tab. You should see a “Forecast” section. For our graphs one period corresponds to one day. So if I want to predict my application’s growth ten days into the future I can enter “10″ in the “Forward” box. Since we want to predict Booze Mail’s growth by the end of July and today is the 15th I’ll extend the trendline 16 days into the future.

Click “OK” to graph the trendline. You might want to change the size and color of the trendline to make it stand out. Let’s see how Booze Mail is doing.

So, according to the graph, Booze Mail should hit one million users by July 25th. Anyone want to bet?

[tags]facebook,application,appaholic,tracking,analytics[/tags]

Fred Wilson is commenting this morning on Jim Breyer’s words at Fortune’s iMeme conference last week on unfounded blogosphere rumors of a multi-billion dollar Facebook acquisition.

Barron’s quotes Breyer, the Facebook director and Accel VC,

Part of it is always price…The company will do well over $100 million in revenue, and profitable, and significant EBITDA positive this year. Right now our job is to build out the company as significantly as possible. In our case, sold best companies too early…sold Perabit to various networking companies, a series of our networking companies that today would have been possible IPO candidates.

Fred adds,

But selling the Company would be a huge mistake. First and foremost for the users. Any buyer will screw up Facebook. It’s greatness comes from the fact that the people who run the company live inside the service, they built if for themselves and it works because of that. They have their pulse on the community and they are not likely to screw it up too badly…So why do companies sell? Because of fear, boredom, and personal financial issues.

It’s great when companies and investors have aligned needs and timing–if that’s the case, perhaps Facebook will IPO in the next year or two indeed. But Facebook’s investors ultimately have a responsibility to generate a return for their investors, and thus will always be promoting their portfolio while saying they’re not for sale at the same time, just like Breyer did at iMeme last week.

[tags]facebook,ipo,acquisition[/tags]

Introduction

Developing any computer application is a process that will inevitably involve many mistakes, bugs, and other trials. Indeed, half of writing an application is just testing the code to make sure it behaves correctly, and scratching your head when it doesn’t. Clearly, you want to shield your end-users from experiencing the app in such a state. So, one important and popular web application development technique is to have a local test server for development, only pushing code to the live server after it has been appropriately tested. This is a relatively easy process, especially if your local server (be it your laptop or some other computer on your local network) runs the same OS as your server.

Writing Facebook apps adds a layer of challenge to this development pattern, since you can’t exactly download the Platform and run it on your computer, and anyway with all the overhead you wouldn’t want to. Furthermore, each app has a specific server to which it is linked, and there’s no current way to list “test” servers alongside the live one. Hence this tutorial.

(What follows assumes you’re already somewhat familiar with the Facebook Platform and the Developer Application, and, obviously, that you know how to write an application. If not, go to Facebook’s Developer page for more information).

Step 1: Preparing Your Local Environment

The first part of local prep is to ensure that your local server has web server and script interpreter software installed. By far the most common arrangement of these is the LAMP set-up (Linux/Apache/MySQL/PHP). Various LAMP (or “WAMP” for Windows) installer packages exist for just about every platform. In Ubuntu, simply search for the individual packages and install them. For Mac OS X, I like Marc Liyanage’s packages here. For Windows, I have used WAMP Server.

Once you’ve got your server operating locally, the next step in local Facebook app development is ensuring that your local server can be accessed from the external web. There are a number of ways to do this, but unless your server has a dedicated external IP, it will involve port forwarding from your internet gateway (perhaps a DSL modem and router) through to your server. Since each internet gateway is different, the actual steps in the process will themselves differ, but basically, you need to ensure that port 80 is passed from your gateway to your server. It makes it easier if your computer has a static IP internally, that way you can forward port 80 to that IP and you know it will always go to your server. Otherwise, every time you reconnect your server/computer to the local network, you may have to change the internal IP address to which you’re forwarding port 80. To get instructions for forwarding with your particular router, check out portforward.com.

Third, you need to find the external IP for your internet gateway. If you already have a dedicated IP, you’re set. If not, you need to find out what your external IP is. The easiest way to do this is to go to whatismyip.org. Copy and paste what you find there, and save the IP for later.

Finally, ensure your web server accepts connections from the wider internet by pasting the IP into the address bar of your browser. If you get a response from your server, you’re good to go! If not, you need to fix your server set-up, or if your server works fine locally, your port forwarding. Note that if you have a home network with an internet gateway (DSL router) and a wireless router, and you’re connected to the wireless router, you’ll need to forward port 80 from the gateway to the wireless router first, and then configure the wireless router to forward port 80 to your computer. This is a complicated set-up, but hopefully isn’t too common.

Step 2: Preparing Your Test Facebook App on Facebook

Since Facebook doesn’t allow you to have a “dev mode” for your new application, you’ll need to create a whole new test application. Call it whatever you want. Make sure to give it all the same settings as your real app, except (1) Use the IP you copied in the last step for your server (plus any subdirectories you may be using), and (2) Make sure you pick a new name/canvas page URL for the test app. Most importantly, check the box that makes the app restrict adding to developers only (so random people can’t add it)!

When your app is successfully created, note that it has a different API key and secret key than your “live” app. Copy these values down somewhere.

Step 3: Coding Your App / Modifying Your App to Run Locally

If you haven’t coded your app yet, now’s the time to do it.

If you have, you’ll need to make a few changes to ensure it runs locally. First, replace your API keys with the test ones. Second, make sure that any references in the app to your live server are changed to your local server (for images, urls, etc…). Third, ensure that your database connection strings are valid for your local database.

…And that’s it! (One word of caution, however: given that your test app is, to Facebook, actually a different app than the live one, your app’s functionality vis-a-vis the “friends” system will be hampered somewhat. One way around this is to designate a few volunteers as developers also, so you can test multi-user behavior. Also, you will want to be careful with News Feed actions and stories, since these will actually show up on the live site, but may confuse your friends who see them.)

Anyway, you should now be able to add your test app on Facebook and Facebook will query your local server for its pages. You can make changes to the code and see them reflected instantly, without uploading anything. This is by far the most efficient way to develop, or continue development of, a Facebook app.

Step 4: Avoiding Dev/Live Sync Pitfalls

A problem exists, if you’ve followed the instructions faithfully: You now have two apps, one local and one remote, each with its own version of the code. Your well-tested local app now contains the newer (and better) code, but if you just uploaded it to the remote server, or committed it to your versioning software (I heartily recommend using SVN, by the way), you would overwrite all the live server’s settings, including API keys, local URLs, database connections, etc…

The best way to get around this problem is to extract all such settings to an environment file which is required by and parsed before all other scripts. In my environment file, I define PHP constants like API keys, database connection information, server IP, and so on. These constants will then be available for my app, and will be appropriate to the server at hand. This environment file should never be added to SVN or uploaded to another server, because it only pertains to its own locale.

With this technique, you can happily “svn ci / svn up” or FTP upload your code revisions from your local dev server to the remote live one, and they will take effect at that time, while still using the server’s own particular settings.

Conclusion

I hope that this tutorial has been useful. There is really no more efficient way to develop than when your local code changes can be tested immediately. But one reminder: if your internet gateway is restarted or acquires another IP address somehow, you will need to change the test app’s settings on Facebook (and any references of your own to that IP) to reflect this. Also, if you are traveling and using someone else’s internet, you’ll need to have access to their router to go through the steps above of ensuring port 80 forwarding to your machine, adjusting the test app’s server settings on Facebook, etc… Still, I have done this at a number of houses around the US, and it has worked like a charm.

Another alternative is of course to use a service like no-ip.com, which tracks your gateway’s IP changes and allows you to always access it using a certain domain name. If you do move around a lot, this could be a time-saving solution (though you’ll still need to pass port 80 to your box).

If you have any tips, techniques, or strategies of your own, please leave them in the comments!

[tags]facebook,apps,local-development,development,how-to,tutorial,facebook-apps[/tags]

Everybody with a website knows that Google owns two of their most important marketing channels: organic search (SEO) and paid search (SEM). In fact, entire cottage industries have developed around them:

• SEO (Search Engine Optimization) – gaming Google (and the other search engines) into thinking you’re authoritative on a given topic and deserve to be listed highly in its search results.
• SEM (Search Engine Marketing) – paying Google (and the others) to put you next to sites it thinks it is authoritative on a given topic.

Inside Facebook, however, Google is irrelevant. Instead, Facebook owns your most important marketing channels: the News Feed, Notifications, and Messages. And marketers and application developers have analagous marketing options with Facebook as with Google on the open web:

1. NFO (News Feed Optimization) – convincing Facebook to display the Feed items that your application publishes in your users’ friends’ News Feeds.
2. NFM (News Feed Marketing) - paying Facebook to insert your ad next to Feed items that it thinks are important enough to be shown.

News Feed Marketing is fairly easy for marketers to understand: give Facebook your credit card number, and they’ll stick you in the News Feeds and guarantee a certain quantity of targeted traffic to your Facebook application or sponsored group.

News Feed Optimization, on the other hand, is a bit trickier:

• Like Google’s PageRank algorithms, Facebook’s proprietary “FeedRank” (my term) algorithms determine which Feed items are shown to whom and which items are not.
• Like Google’s undisclosed PageRank algorithm, the variables that contribute to your Feed item’s FeedRank are unknown to you (and everyone except Facebook).
• Like companies dependent on their SEO’d Google PageRank, companies dependent on their NFO’d Facebook FeedRank will experience similar trauma when the algorithm unpredictably or inexplicably changes.

Welcome to the new world of NFO–the new SEO for Facebook marketers. Optimizing your product’s News Feed items is the single most important thing you can do as a marketer on Facebook. Not only should Feed items be designed for optimal conversion, but they should also be invoked by your application in ways that will maximize their distribution.

Designing High Performance News Feed Items

1. The most important thing you can do as a Facebook application marketer is to publish engaging, authentic Feed items. Whenever a user performs an action within your application, consider whether hearing about that action would be valuable to that user’s friends. If so, publish a Feed item about that event.

For example, the Moods application invokes a Feed item when a user changes their mood. The feed item simply contains this contextually appropriate “news” about my friend Holly–she has updated her mood within the Moods application (I’m glad to hear she’s feeling happy).

Likewise, the Books application publishes a Feed item when a user indicates that they have started or finished reading a book. This is also news that I find appropriate and interesting about my friend–I might even casually follow up with Jonathan about this “news”.

2. Be sure you optimize your Feed items for all of the Feed item elements made available to you by Facebook: title, body, and images. The Facebook Developers Feed Item documentation describes the requirements and limitations of each Feed item element as the following:

• The title is required, and is limited to 60 displayed characters (excluding tags).
  • The a tag is allowed, and there can be zero or one instance in the title.
  • One fb:userlink tag is allowed, and the uid parameter must be populated with the user id on whose behalf the action is being published. If there is no such fb:userlink tag found, then one is automatically prepended to the title.
  • The fb:name tag is allowed, and there may be multiple instances of this tag.
  • No other tags are allowed.
• The body is optional, is limited to 200 displayed characters (excluding tags), and can include the tags fb:userlink, fb:name, a, b, and i.
• Up to 4 images can be displayed, which will be shrunk to fit within 75×75, cached, and formatted by Facebook. Images can either be a URL, or a facebook PID. If it is a URL, you must own the image and grant Facebook the permission to cache it. Each image must have a link associated with it, which must start with http://

As you notice above, both Moods and Feeds use short titles to get your attention and longer, more descriptive bodies. Moods also includes an image, which is very attention grabbing.

Be careful, however, to resist the temptation to always max out the images you include with every feed item just because they’re “essentially free ad space”. This could make your Feed items seem spammy and adversely affect your Feed item conversion rate.

3. Include inviting, provocative calls to action that lead the reader to install the application directly.

Ultimately, the value of the News Feed the application developer is that it’s powerful, free marketing. The News Feed can be used to convert your users’ friends to do things you want them to do – like install your application. You need to make this conversion process as quick and easy as possible.

For example, you’ll notice that the Moods application asks the reader, “How are you feeling?” immediately after the Feed item body. Clicking this link leads to the Moods application installation page. As a result, the Moods application has experienced significant growth despite not doing any active marketing.

The Books application prompts the reader to click on the title of the book my friend just finished reading. However, clicking this link does not lead me to install the application, but rather through an affiliate link to Amazon, where the Books developer will earn a commission on anything I purchase.

Achieving Optimal News Feed Distribution

In addition to designing Feed items for optimal conversion, your application should also invoke Feed items in ways that will maximize their distribution. Like Google’s PageRank algorithm, Facebook’s FeedRank algorithm is and will remain unpublished by Facebook in order to fight the war on Feed spam. This, however, presents obvious challenges to application marketers.

I spoke with Facebook Senior Software Engineer Justin Rosenstein about News Feeds and the selection algorithms last week. While he wouldn’t divulge the algorithm :) , he did offer the following facts about News Feed:

• News Feed publishes just a little more than 0.2% of the stories it considers. This means that out of every 1,000 feed items that are selectable for publication, only 2 become News Feed items that friends see.
• The Facebook weighting algorithms apply some general principles, but they primarily rely on behavior specific to each user. This means that while your Feed item may score highly on many factors, Facebook will hide your Feed items for some users it thinks wouldn’t find your item interesting. Facebook considers nearly every available source of data it has on each user to help calibrate their weights and deliver the best stories.
• Facebook is constantly improving their algorithm as new data becomes available. This means your experience will change with time. What is true today may not be true tomorrow.
• Users can also help direct News Feed outside its normal bounds with their News Feed Preferences. Remember, Facebook lets users weight Feed items from certain friends more or less interesting–though it doesn’t have a general “Application” weight preference slider.

The Facebook Developer documentation on Feed item publishing parameters and limits has been changing almost every week since the Platform launched in late May, and as such the FeedRank algorithms are still very much a work in progress. For example, recently, Facebook had explained its algorithm in terms of a points system in which application developers get 5 points per user per day to spend on Feed items, where points spent on a given Feed item boost its FeedRank.

Now, however, Facebook places the following limits on Feed items:

• facebook.feed.publishStoryToUser – Publishes a News Feed story to the user. Applications are limited to calling this function once every 12 hours for each user. The story may or may not show up in the user’s News Feed, depending on the number and quality of competing stories.
• facebook.feed.publishActionOfUser – Publishes a Mini-Feed story to the user, and publishes News Feed stories to the friends of that user. Applications are limited to calling this function ten (10) times for each user in a rolling 48-hour window. The story may or may not show up in the user’s friends’ News Feeds, depending on the number and quality of competing stories.

Ultimately, gaming the News Feed is going to be harder than gaming Google’s PageRank algorithm because of the personalized nature of Feed item selection. Because so many components of FeedRank depend on individual user behavior, there is only so much you can do as an application developer to boost your Feed item’s score across the board aside from designing rich, engaging Feed items that convert well.

That being said, it’s probably only a matter of time before the same type of people who created PayPerPost set up a new type of shop to game Facebook: in a world where individual behavior matters most, I’m sure you will soon be able to buy not only application distribution, but also News Feed clicks, hoping that Facebook will believe that your feed items really are that interesting.

[tags]facebook,news feed optimization,news feed marketing, nfo, nfm[/tags]

The Facebook platform is great. Great, that is, except when a bug on Facebook’s end renders your application useless. People expecting to see growth like iLike were sorely disappointed if they were unlucky enough to run into a series of timeout bugs that have struck Facebook in recent days. According to Facebook these problems are all fixed, but for some, it might be too little, too late.

From the user’s perspective these timeouts look like problems with the application, even though they happened for no other reason than the application was hosted on a machine with a certain IP address. The users don’t care, though, and they’ll happily uninstall the “broken” application.

Take Matches, for example–an application affected by this bug. Over the course of the period in which Matches was affected by this bug, the application lost over 100,000 users. Once the bug was finally fixed on the 14th of July, however, it started regaining some of that loss. They are now posting about 0.18% growth each day.

Problems like these are expected on a platform as complex as Facebook’s, but they can still serve to illustrate the potential dangers of tying your software to such a young, monolithic environment. All your eggs are in Facebook’s basket so when they go down, you go down, too.

Although it’s in Facebook’s interest to foster a community and market around the platform, every single application is still at the mercy of Facebook’s stability. Remember Adam Smith’s lesson, “[i]t is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.” Let’s hope Facebook stays interested.

[tags]facebook,platform,application,dangers[/tags]

It used to be that travel and vacations meant t-shirts and cheesy souvenirs. But with Facebook, you can tell your friends about your trip without all the ugly schwag. Currently, there are over 60 applications in the Facebook Application Directory in the Travel Category. We’ve sifted through dozens of them and found the best.

The most popular travel application on Facebook is Where I’ve Been by Craig Ulliott. As the name suggests, the app lets you quickly build a map of places you’ve traveled to and display the map on your profile page. After installing, you’re prompted to select countries, states, provinces, regions where you’ve traveled on a world map created in Flash. While the map is large and easy to access, using the three screens to zoom and move around does present some difficulty. When you’re clicking on countries, each click toggles between blue, green and red, representing that you’ve visited, wanted to visit or have lived there. (These colors are not that well defined and initially it can be confusing why the colors keep changing with each click.)

Once you’ve selected your regions, the application installs a smaller map on your profile page for all your friends to see where you’ve been. You can also compare your map with your friends’ maps and see who’s really been to more places. “Where I’ve Been” is the clear winner in the travel map category.

A close second is Cities I’ve Visited by TripAdvisor.com. Instead of selecting the geographic regions, you select individual cities, and pins are placed on the map for each city that you’ve visited. The selection process is quick, and you can choose between popular cities or the list on the travel map. The map also automatically zooms and aligns to include all the cities that you’ve visited. We were surprised that more features were not included to tell your friends about your trips.

There are many applications similar to Where I’ve Been and Cities I’ve Visited that require you to create an account on the application developer’s website, and some even require that build your travel map in their interface. You should skip these clones and stick with these two applications if you want to show your friends how worldly you are.

To plan future trips or to tell people specifically about past trips, you need move beyond the travel map applications. One of the easiest trip-specific applications is the Journey Miles application by Chris Poe. The application lets you describe past trips in great detail, create a trip map using Google maps, and even lets you link to a Facebook Photo Album related to the trip. You can also schedule trips in the future, invite your friends and see who is in for the summer road trip to the beach.

One of the older and more popular trip focused application is the Trips application by SideStep.com. One disappointment with this application is the “Invite all your friends screen”. You need to carefully skip this screen or you’re going to be that guy/girl that spams his/her friends with application invites. Once you install Trips, it’s easy to create past trips and describe them in great detail. You can also include future trips and invite your friends, almost like the Facebook Event interface. Overall, it’s a solid application that just needs a few updates.

For people actually traveling or planning an immediate trip, there are two hostel applications that you can use research hostel locations if you’re a hostel person. Hostels by Hostelbook.com lets you read and write reviews on Hostels you’ve stayed at or are considering and even make a reservation with Hostels. The Hostel application by Bukpak lets you see research Hostels in different cities and also includes pricing at each location. It would be good to see a combination of these two functions as they both add value to travelers.

And if you really need to visit a friend there is Flight Finder by SmarterTravel.com. This application lets you select a friend and choose some travel dates to be presented with flight options from the SmartTravel.com site. Your friend’s hometown is automatically current inside the Flight Finder application. All flights are displayed in a separate window on the SmartTravel.com site; the experience would be much better in the Facebook environment.

Lastly, if you’re overseas and want to know the local currency conversion, the Currency Converter application by Oanda will provide real-time currency conversion exchange rates for most major currencies.

[tags]facebook,travel,apps,maps,best[/tags]

Search volume for “Facebook” is 4x what it was a year ago. Media references to “Facebook” are 4x what they were four months ago, back to September 2006 feed-privacy-concern levels. Just yesterday:

• Henry Blodget propagated the rumor that Microsoft is offering $6 billion to buy Facebook.
• CNBC asked John Battelle to talk on TV about “Facebook Becoming the Next Google?”

Call it fascination or call it hype, but there’s a lot of it right now.

[tags]facebook,media,search,microsoft[/tags]

For Facebook application developers, not all VCs are created equal…at least when it comes to the support they can lend your company if they also happen to, say, sit on the board of Facebook itself.

That’s the position Jim Breyer, David Sze, and Paul Madera find themselves in as they size up pitches from application developers for Accel, Greylock, and Meritech Capital, respectively. Not only do they have the inside track on spotting up and coming applications, but they also have the power to make life for an application developer considerably smoother.

As for Accel, Jim Breyer tells us that his fund is “actively evaluating important application developers” in the “video, utility, gaming, and entertainment” categories, but is not yet announcing any deals. Depending on how you look at it, that’s either great or terrible news to all the other video, gaming, and entertainment apps out there :)

However, it’s unlikely that Accel will launch a SNAP (Social Network APplication) fund like AppFactory at Bay Partners. Accel will just invest in Facebook app developers from their existing funds.

Cultivating the Facebook application economy is in nobody’s better interest than Accel, Greylock, and Meritech. Owning successful applications is twice is sweet when you own the platform too.

[tags]facebook,vc,accel,greylock,meritech[/tags]

Well, we knew someone was going to give it a try. It looks like Scott Rafer, founder of Feedster, MyBlogLog, and Mashery, and David Cancel, co-founder of Compete.com, have teamed up to launch the first buy-sell ad marketplace for inventory on Facebook apps. They’re calling it Lookery, and they’re already selling and plan on launching next week.

In one sense, a gutsy call by Rafer and Cancel. Facebook should extend access to their ad platform to application developers soon, but even if they don’t block third parties it will be hard to compete.

That being said, the minimum spend on Facebook direct (Microsoft handles the sales through an agreement reached last year) is $25,000 a month, so some of the new guys could serve an untapped part of the demand curve and snap up accounts with smaller spend until that policy changes.

Additionally, the guys at 30Boxes have launched a link exchange network for Facebook apps called fbExchange. They’ve gained some early traction, already signing up Slide, who should devour most of the inventory they can bring on board.

Coincidentally, Ali Partovi, the founder of the Internet LinkExchange (for those who are old enough to remember such things) who later sold it to Microsoft for $250 million, is the CEO of popular Facebook app maker iLike.

What all this means for Facebook entrepreneurs and marketers is that there are new channels emerging to reach the Facebook audience that are more accessible and affordable than buying ads through Microsoft and potentially more effective and scalable than buying flyers.

[tags]facebook,marketing,advertising,links,linkery,fbexchange,adnetwork[/tags]