Forget about Ads; Facebook to start selling Insurance

Since Google changed the business model on Microsoft the only way Facebook is going to change the rules is adopt a totally new business model. I think social networks like Facebook will make incremental moves if they try to “out-Google” Google.

Instead, Facebook should start to offer services that “friends” should jointly get value from. The inherent power of many on facebook. Here’s a couple that make sense:

1. Remember IEEE would offer all members a joint insurance (I think it was life insurance) but why cant facebook offer that for groups?

2. How about aggregate buying? If my friends and I all like the new Powerbook how about getting us all combined to buy one at a discount someplace? Update: BusinessWeek calls these purchasing co-ops

I am sure there are many more, but this would be the best use of the “social graph” that’s on my list of friends on Facebook.