A couple of facts first:
1. Orkut was bought out by Google when it was already HUGELY popular in Asia/S. America and part of Europe. After purchase however, they did not develop it at all for nearly 4 years. Likewise, they actively killed dodgeball - another very popular social networking tool in the US.
2. Fact: Google has not been good at social networking. Root cause? Google does not know how to empower and productize. That is the real problem here. Take the lack of development behind Google Talk local client, killing Wave before iti had any real chance and burning any chances that Calendar had when the smarts decided to launch it without a sync software (w/outlook/notes).
PS Google Contacts is a disaster/joke by anyone's standards after spending 5 minutes with it. I am sure MS has nothing to worry about at this point in the real world space.
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