Why is Facebook only going to earn $300 million in revenues this year, despite 80 million active users on its site? Not because Facebook has outsourced much of the ad-sales work to Microsoft. Not because Facebook's Social Ads have miserable clickthrough rates. It's because at Facebook, making money isn't the priority. "Our focus is on growth — we believe this is the moment people are joining social networks," Sandberg told a crowd at Fortune's Brainstorm Tech conference. "Then it's monetization to support that growth." Sandberg, a White House veteran, didn't stop there with the Washington-quality doubletalk.

Buried in a report from the New York Times on Apple CEO Steve Jobs's health scare is this revelation:

Twitter got its big break with mainstream America today — a big article in the free Ramada Inn daily, USA Today. In fact, the article drove so much traffic to Twitter that — whoops — it crashed. Again. "They used to call it the Slashdot Effect," Valleywag's resident Olds Paul Boutin tells me, "Your site would go down right in the middle of your moment of glory." Smartly, though, Twitter PR managed to get USA Today's Jefferson Graham to build an excuse for the site's Love For Fail right into the article. Graham reports:

Jake Orion, the Sprint engineer in charge of Android development who mixed honest criticism with cautious optimism for Google's Android device in an interview he gave AndroidGuys.com earlier this week, has, under pressure, backed down from his comments and demanded that AndroidGuys take down his interview.

Touchy Viacom flack Jeremy Zweig called Valleywag up to let us know personally that we'd been disinvited from next week's press-only screening of Tropic Thunder. Such a pity! Because we had a list of questions we were going to ask Viacom CEO Philippe Dauman:

Viacom's legal spat with Google has the media conglomerate cast in copyright-hating, freedom-to-upload-videos-loving Silicon Valley as a mustachio-twirling villain, out to expose YouTube viewers' usernames and IP addresses. Bwahahaha! Benighted flack Jeremy Zweig has been reduced to leaving comments on blogs in response. At last, he's getting some corporate firepower: Zweig and Viacom CEO Philippe Dauman Sr. are inviting a bunch of tech journalists a screening next Monday of Tropic Thunder, the Ben Stiller action-movie parody coming to theaters next month, and YouTube probably sooner than that. We've seen the invite list, and it left us scratching our heads.

Phil Schiller, Apple's head of worldwide product marketing, attended this morning's iPhone 3G launch in person at the company's Boston flagship store on Boylston Street. Former Valleywag reporter Jordan Golson, reporting for the Industry Standard, told us Schiller was all cheer and cooperation. "It's the first day we've been doing this," Schilller said. "We'll get better at it as the day goes on." Schiller's eagerness to talk didn't stop a blue-shirt store staffer from ejecting Golson with a great canned speech: "The press folks who have been inside for a long while need to leave so we can let more people in." Sounds fair, until you see Golson's photos of the wide-open spaces around Schiller and his son, plus the obligatory First Guy in Line being interviewed on video.

Despite reports to the contrary, Viacom did not, as a part of its copyright suit against Google and YouTube, ask for "any personally identifiable information of any YouTube user" the company now wants us all to believe. It will get data from YouTube, but anything personally identifiying will be "stripped from the data." It's nice bit of PR revisionism. According to court documents, Viacom did "seek all data from the Logging database concerning each time a YouTube video has been viewed." Only after the court sided with Viacom, but public opinion did not, did Viacom agree to accept scrubbed data. (Photo by AP)

What's deal-making like at Microsoft, post Yahoo-Google? Kind of sad. For example, instead of planting stories with billion dollar ramifications, Microsoft PR over the weekend fed the Wall Street Journal a story on how MSN videos in online sports and entertainment are so popular they exceed sold inventory, so Microsoft will ask the YuMe network to sell extra ads. For Microsoft PR, victory is no longer a leak that breaks the ice, but sneaking PR speak like the following into a Journal reporter's copy:

Google's lawyers usually busy themselves trying to defend their right to keep content online — so Google's search engine can index it, of course. Odd, then, to see Stacey Wexler, litigation counsel for Google, send New York tech blog Silicon Alley Insider an email asking it to take down references to a YouTube advertising contract in a story about the video site's new revenue-sharing program for ads sold by video creators. Odder still to see Silicon Alley Insider post the email to its site, then take it down (the site now displays an error where Wexler's email once appeared, but the original post about YouTube remains online, and a reader has reposted the item in a comment). We're puzzled about what, precisely, is so controversial about the YouTube revenue-sharing program. (Wexler claims the contract is confidential, but we don't think that's Silicon Alley Insider's problem.) The contract reveals that Google will take 45 percent of ad revenues, with a minimum campaign budget of $10,000, unless otherwise negotiated. Read Wexler's letter to Silicon Alley Insider, reproduced below, and the contract, embedded via DocStoc, and tell us which terms you think Google was most concerned about keeping private.

Perhaps my weekend sojourn in Hollywood left me jaded. But an email anonymously tipping Valleywag about YouTube's "head of monetization" and former Google Web search lead Shashi Seth leaving the Googleplex to become COO at multimedia browser developer Cooliris smelled fishy. Seems we weren't the only site that got a tip, which suggests that our Yahoo Mail-using correspondent is probably a flack using the time-honored entertainment industry trick of a publicist "leaking" a detail to the press. My guess? Someone representing Cooliris. Though hiring the guy who was ultimately accountable for the failure of YouTube to make any money doesn't seem like a real "top talent" poaching from Google.

Haven't heard much about Joost lately? That's because the online-video startup, founded by the same obstreperous Europeans behind Kazaa and Skype, seems to be going exactly nowhere. It is the opposite of newsworthy, with its software-based approach to video distribution having been completely undone by YouTube and Adobe's Flash technology. Adobe is adding peer-to-peer distribution, Joost's main distinction, and even investors like Viacom CEO Philippe Dauman have taken to dissing it. Could there be worse news? We can't imagine it. But Joost's flack can.

Trying to download the Sex and the City movie last night, I had to wonder, When is a torrent site more comfort than a Cosmo? If you can't fulfill your Sex-seeking ladylove's needs with some unpacked .rar files, I understand. So does Best Buy's Geek Squad, which is offering rescue packages composed of quarters and excuses for men who don't want to lose quality videogame time to the premiere of the world's most commercially viable feature-length shoe porn. Geek Squad has it only half-right: Why not save your quarters and hire a girl to be professional company at the multiplex — for your girlfriend? (Photo: Daniella Zalcman)

CARLSBAD, CA — Mark Zuckerberg has learned nothing. Taking the stage at D6, he uttered nothing but bromides and nonsequiturs. Examples: "Facebook is a technology company ... a technology company is a company that creates technology"; "Religion, that's a big thing around the world". At his South By Southwest keynote, Zuckerberg benefitted from a crowd obsessed with the friendliness of Sarah Lacy's questions. With Kara Swisher, never a kind locutor, Zuckerberg had the spotlight shone on him, and he came off simply blank. Which is why he hired Sheryl Sandberg from Google, right?

In the '90s, Washington PR firm Chlopak Leonard Schechter pushed anti-Microsoft information that its client, Oracle, had obtained through hiring investigators to rifle through garbage. Now working for Google, Chlopak is taking a greener approach: It's reusing Google-friendly quotes already aired in the press as fill-in-the-blank quotes for other journalists. Chlopak flack Rob Haralson does not note that the quotes, which support Google's proposed deal to take over Yahoo's search advertising, mostly come from Google executives or lawyers speaking anonymously. Still, Haralson may not be acting as strategically as he thinks. The quotes portray the deal, which is facing antitrust scrutiny in Washington, as no more significant than a supplier providing parts to a PC maker. That may not be a particularly good analogy — has Haralson ever sat in on an Intel negotiation? Google's recycled arguments:

We live in an overfamiliar age. Why should our flacks be any different? Even so, Startup-PR consultant Renee Blodgett has raised the bar for the rest of her industry. Blodgett, PBS informs us, "is one of the PR folks who understands how to communicate with bloggers." A blogger who forwarded me an email from Blodgett begs to differ. Blodgett and said Web scribe have never met, and yet Blodgett feels perfectly comfortable proposing "social" time, planning a "small group dinner," and asking for hotel recommendations. All this with four smileys thrown in for good measure. The email:

When bad news about a company dominates the headlines, sometimes a company's PR team will craft bogus announcements to distract shareholders. Which is why today in the Wall Street Journal, you'll find that Yahoo and agency behemoth WPP announced a partnership to create "an electronic system for advertisers and Web sites to buy and sell online ad space." The deal isn't exclusive and in fact, it's a mere "extension of the technology partnership" Yahoo EVP Hilary Schneider told the Journal. Why didn't Schneider just try the old "Hey look! The space shuttle!" routine instead? That seems easier.

Ignoring Google's seeming endorsement of IM speak, or tweener, invading the English language by titling the company's logo art contest "Doodle 4 Google," the entries present a striking glimpse into the fears of typical American children — from deforestation to global war. Finalist Mariam Hovhannisyan, a high schooler at the International Community School in Kirkland, Washington, laments an irreversible slide into the mechanization of humanity:

Yesterday AT&T added language to its website that promised iPhone subscribers free Wi-Fi hotspot access to the company's listing of features for customers. A few hours later, the offer was removed from the site. The rollout for free Wi-Fi for iPhone subscribers on AT&T's network isn't going so smoothly — after the unannounced program was discovered, hackers shortly discovered they could log any device onto the network quite easily. (Photo from Jajah)

CEOs and founders feeling hounded by pesky profit-hating humanitarians could learn a lesson or two from Google cofounder Sergey Brin. At Google's annual shareholder meeting yesterday, Amnesty International presented two shareholder proposals on behalf of the New York State Pension Funds involving Google's difficulties with China, privacy and censorship. Brin handled the PR mess, no problem.