The much hyped flotation of Facebook this Friday on the Nasdaq Stock Market in New York is likely to be seen as yet another watershed in a sector that has seen spectacular stories of boom and bust for most of its turbulent history.

With an IPO that could value the company at more than $100bn, demand for the social network stock has been strong – so strong that many are warning of a massive over-valuation, and are warning potential investors to think carefully before placing their money.

Mark Zuckerberg, its founder, will remain the company's largest shareholder with a personal stake worth around $19bn.

By any measure, the figures surrounding Facebook are truly staggering. One in every 13 people on this planet has a Facebook account and over 900 million of them actively use it every month. With over 125 billion friend connections already created, every 20 minutes sees a million new links shared, 1.9 million friend requests accepted, 2.7 million photos uploaded and over 10 million comments posted … and that’s even with countries such as China officially banning access to the site.

But the news that General Motors will pull its paid advertising from Facebook has cast a shadow over Friday’s event, with many asking if this is the thin end of the wedge. The $10 million paid by GM to Facebook hasn’t generated the sales they had hoped for, apparently having little impact on consumers' decisions to buy cars – though I have to wonder how anyone can measure whether an ad on Facebook results in how many cars are sold. Who doesn’t remember the ad-man’s famous dictum: Lord Leverhulme, the founder of Unilever, and the car manufacturer Henry Ford are both credited with saying "I know half of my advertising budget is wasted - I just don't know which half."

Maybe what GM actually realized is that you can probably get just as much of a social response from free placements on Facebook than if you actually dollop out a handful of the readies! But as some 85 per cent of Facebook’s revenue comes from advertising, the loss of General Motors’ paid-for advertising is bound to raise concern.

The other unknown factor of this flotation has already been admitted by Facebook: its current inability to make money from customers using the site on mobile phones, which already accounts for around half of Facebook's current users. As more and more of the world moves to just mobile-only use, this could be quite problematic.

Surely the truth is that no one can possibly know for certain what this company is worth? It’s a truism to say that the entire social media environment is in a continual state of flux, and new rules for the efficacy of advertising are being rewritten continuously. Add to that other pressures, such as economic downturns and recoveries and it’s hardly surprising that even the most experienced players are swimming in the dark.

Many will remember the sale of MySpace to News Corp. for $580 million. At the time it was lauded as a triumph – but within a very short space of time the ascent of its new rival, Facebook, led to ad sales plummeting and News Corp dumped MySpace for a loss of nearly $550 million.

You could, of course, argue that Facebook’s new investors are not so much interested in the $3.7 billion in revenues the company reported last year, rather than the potential reach to eight percent of the world’s population, bearing in mind that 80% of Facebook users live outside the US and Canada.

In the longer term, Facebook may well turn out to be a great investment, but I have to admit that I, of one, will definitely not be among the flock of sheep straining to pick up a piece of the Facebook action this week.