Social networking site Facebook appears to be worth $10 billion dollars as a Russian investment group Digital Sky has just bought a two per cent stake in Facebook for $200 million. If price was applied to the rest of the shares, the entire outfit would be worth $10 billion.

Microsoft paid $240 million for a 1.6% stake in Facebook in October 2007. That deal placed a $15 billion valuation on the social networking site. This means that the value appears to have dropped a fair bit. To be fair to Facebook its own valuation is that it is worth $3.7 billion.

Analysts and people in the know claim that it is both good and bad news for Facebook. The good news is that the outfit can get a good valuation even when the market is pants. The bad news is that its valuation still appears to be dropping.

Facebook Chief Executive Mark Zuckerberg would not comment outright about the valuation figures. He said that the share deals are not identical and it is impossible to make any comparisons.

We would have thought that given the fact that Facebook has not made a profit, web businesses like Fudzilla, which do, should be worth a couple of trillion by now and Fudo would have a mansion that is 14 times the size of Bill Gates.