TechCrunch’s Duncan Riley starts off this week in Merger Madness Month with Who Will Buy Facebook?

Today we found out that Facebook will be opening up its platform, though this could be done in fact in two ways.

Frankly, the main assumption that Facebook will sell to someone is faulty.  The real question should be Will Facebook IPO or Sell?

Of course, we’ve been proven to be wrong before, when Google bought DCLK.  In fact, we were wrong 3,100,000,000 times.

Then again, since it was that deal that kicked in Merger Madness Month - accentuated by MSFT’s $6B AQNT deal last week - I’d say that anything is possible.  But, anything includes demand from investors for an IPO like Facebook.

Some facts, arguments, FYIs:

- Riley’s argument that Facebook as a stand alone entity will carry a lot of risk reminds me aplenty of the argument that Google as a stand alone company would bear a lot of risk.  Well, indeedio, and with risk comes return.  $85, meet $500.

- Previously we wrote that Facebook’s to do list includes an IPO in 2008.  Read that here in full, but the main points are:

1. Will the IPO replace the M&A in media?

Of course, Google and MSFT blew that argument into smitheerins to some extent, though my argument had more to do with technology, media and not services and ad networks that yield greater networks effects as part of a bigger deal.  Does that sound like backtracking, to some extent, yes.  Google/DCLK and MSFT/AQNT were massive deals, after all, pretending like it does not change my outlook to some extent is insulting to you the reader.

2. Facebook has priced itself out of an M&A.

If Viacom and Yahoo!’s $800M to $1.6B offers were not enough last year, why on earth would they be now?  Thiel himself came out and said Facebook is worth $8B.  That’s salesmanship, but under all statements are a hint of truth - or wishful thinking.

3. MSFT Deal Reality

Early in 2007, CEO Mark Zuckerberg said the advertising contract with Microsoft had been extended until 2011, a deal “reportedly guaranteed to deliver about $200 million in ad revenue through 2008.” 

Hmm, 2008, there’s that figure again.

4. $50M in Revenue is the new $100M for IPOs.

But don’t worry as Facebook is on pace to clock in $150M this year.

5. Growth, Maturity and Monetization in Social Networking Advertising

We still don’t think that social networking inventory is all that special, but the fact is that it is less undesirable than it was just a few quarters ago.

Again, if these bullet points seem a bit incomplete read this.

But since we first wrote that, we’ll add a couple more reasons:

6. Facebook Classifieds

This could fizzle or sizzle, but the bottom line is that the in-house projections for these must be enormous.  Internally, between the VCs and Zuckerberg’s head, this launch added a few billions to the valuation.

7. The Open Platform

This will be officially announced on Thursday, but the Open Platform is one, maybe two things:

- Open as in open API.  This will help fuel innovation and invention of Platform services by outside developers, though doing anything on a company’s API - especially as ambitious as Zuckerberg - will prove foolish.

- It seems that it will also open its site.  This is something we thought it should do here.  If it means “open” in this definition, then Facebook just became more relevant to large shares of the Internet population that might not have been bothered to sign up etc.

We’ll find out Thursday, I guess.

8. Facebook: The New MySpace?

I never signed up to MySpace, ever.  But I did sign up to Facebook, and I don’t sign up to too many things.  I did so mainly because I considered Facebook the early leader for candidate for Web Company of 2007 (though AQNT’s homerun deal puts it into play) and trust me, it seems that everyday, everyone is getting on Facebook.

Facebook says its user base has more than doubled to 23 million in the past six months, and it is adding 100,000 new users a day.

9. Google can’t afford Facebook

Google had about $10B in cash, and parted with $3B in the DCLK deal.  Sure, it is printing money, but only one company is printing money enough to pay Facebook $5B and more in a deal.  And, even though aQuantive is not a real comparable, if it got $6B when the day before it was trading at $2.8B on Nasdaq, how much will it take to buy Facebook.  Maybe Thiel wasn’t all that crazy after all.

I doubt Facebook will accept Google stock as currency, and using cash will be hard for Google to do.

10. Only MSFT can buy Facebook

Yes, both founders are Harvard dropouts.  Both products play on human psychology etc., but do we see MSFT buying Facebook?  Well, right now MSFT owns the ad inventory for text ads, and I doubt those figures are doing too well.  But the longer MSFT waits, the more expensive Facebook becomes.  Will this happen?  I don’t know but I made the case before here.

Any thoughts?  Here are plenty from TechMeme.

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