Facebook Isn't Eating Google's Lunch Yet. But It's Getting Hungry…

Facebook vs. Google is the best fight on the Web, but it’s not exactly an even match, yet. Google, for instance, has a huge ad business. And Facebook is just getting started.

Citigroup’s Mark Mahaney provides an update, via a survey from online ad buyer Efficient Frontier, which surveyed its clients about their spending at both companies.

The takeaway: Advertisers spend around six cents on Facebook for every dollar they put into Google. Which sounds small, except that Google is huge and sold $29.3 billion (!) worth of ads last year. So that implies Facebook’s 2010 ad revenues were nearly $2 billion.

And if you’re a Facebook bull, you think that means the really big stuff is still to come. Mahaney:

… we think FB made 25-30% net margins. For context, in the year that Google generated $2B in Net Rev (2004), its Net Margin was 24%. In our opinion, Google’s growth trajectory post 2004 could be a proxy for FB future growth rate – given what are similar growth end-markets in Internet advertising. Also, over the last several years, Google has expanded Net Margins to 40%+.

Reminder that Facebook’s last funding round pegged the company’s value at $50 billion, which means investors believe it will eventually be worth much more. Google’s investors, meanwhile, think that company is worth $185 bilion.