Today Adknowledge and Lookery announced that Lookery’s ad serving business has been acquired. This means that Lookery’s infamous 7 and a half cent CPM guarantee will be transferred over to Adknowledge via their Cubics platform. I just got off the phone with Scott Rafer, CEO of Lookery, and he stated that the ad serving business on social networks is not for startups and is instead for larger, experienced businesses that have sales teams that can support them.

Lookery will now continue to work on their data targeting services which provide greater margins for the company. Earlier this week we reported that Adknowledge had acquired Adonomics, the public Facebook application tracking service. Adknowledge has been in this space prior to Facebook, but thanks to the Facebook platform launch, the company was able to expand their advertising services via Cubics.

We’re expecting further consolidation in this space considering the vast number of advertisers providing similar services. I consistently write about the low quality of ads on the Facebook platform and that has been a big issue for developers who are finding it hard to attract decent CPM levels. An even bigger issue facing the space is the inability of Facebook to monitor the types of advertisements being served on the platform.

This has resulted in advertisements that push the limits of the Facebook terms of service, putting Facebook in a challenging position. While not surprising news, this is most definitely an interesting turn of events in the Facebook advertising space. Feel free to check out the Cubics blog for more information on the acquisition.

When speaking at the Facebook developer conference today in Berlin, Scott Rafer declared that Facebook platform dead. He posted statistics including one that I posted that suggests Facebook widgets are dead. Lookery’s own statistics from Quantcast suggest that their publisher traffic has been almost halved since the new site design was released. Ultimately, I think we may see an increase in traffic as users become educated on the new design but there is no doubt that developers were impacted significantly.

So what is Scott’s solution for developers looking to thrive following the shift to the new design? Leave the platform and jump on the Facebook Connect opportunity. He suggests that the benefits gained from integrating with Connect will be short term just as it was with the Facebook platform. To increase your odds of success with Facebook Connect, Rafer suggests ganging up with other Conenct applications.

If you are to heed Rafer’s advice, it is time to get back to basics and focus on off-platform activities such as search engine optimization (SEO). While it’s easy to be dramatic and have an attention receiving headline for a presentation, I’m not quite sure that Rafer’s conclusion is completely accurate. I know of numerous applications that continue to be exceptionally profitable despite the platform redesign.

I do agree however that Facebook Connect presents a great opportunity for developers. Over the past few weeks we have seen numerous beta implementations of Facebook Connect and this trend will continue. The real test of Facebook Connect will be the opportunity for viral growth. So far there have been few implementations of Facebook Connect and it is difficult to test the success of each of these applications.

Do you think that the platform is dead? How much emphasis should be placed on Facebook Connect development?

Update
I’ve posted the video of the presentation below.