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Rumors started to leak earlier today that Facebook co-founder Dustin Moskovitz (right) and colleague Justin Rosenstein were leaving to start their own company.

Facebook has since confirmed the rumor to us with a simple quote from Mark Zuckerberg: “Dustin has always had Facebook’s best interests at heart and will always be someone I turn to for advice.”

Fortunately, Rosenstein (who formerly worked at Google as product manager of Google Page Creator) has posted more information about their reasons for departure in a Facebook note to friends, which we have reproduced with his permission below.

In it, he describes briefly how Moskovitz and he plan to build to an “extensible enterprise productivity suite” that uses Facebook Connect as its user authentication system and borrows many of Facebook’s own design conventions. The two of them thought about building this suite from within Facebook but eventually decided that it would make more sense to build it within their own company. The choice quote: “We hope our products will become to your work life what Facebook.com is to your social life.”

I was a nerdy little boy. (Not much has changed.) Starting at age ten, I would spend hours a day holed up in my room, alone or with friends, programming til I collapsed. When I grew up, I wanted to be a software entrepreneur. I knew this with as much conviction, and about as much knowledge of what the role actually entailed, as other kids might have wanted to be an astronaut or President. In high school, I even started “Smiley Technologies, Inc.” and bamboozled some friends one summer into working on a Java-based productivity suite for group collaboration… but by September we learned the hard lesson that it takes more than three months to take on Microsoft Office.

By college, I felt pretty confident I was never gonna work for anyone other than myself. That is, until I heard about Google’s associate product management program. I have an enormous amount of respect and admiration for Google, and the opportunity to be on the inside, working as a mini-entrepreneur, was just too sweet to pass up. So I promised myself I’d stay at Google for just a few years, and then head out on my own.

That is, until a few years later when I got a friend-request from Dustin Moskovitz, who had co-founded Facebook with his college roommates around the time I’d joined Google. I told him I wasn’t interested in another job, but we met up for lunch anyway, and I’m glad we did. The more I learned about Facebook, the more inspired I was by its mission and team, and eventually decided this too was just too important an opportunity to say No to.

I’m really happy I took the job. I’m thrilled with the time I’ve had at the company, and with the incredible peers I’ve gotten to know and work with. But something else exciting happened in the year and a half since I joined Facebook. I started spending a lot of time after work talking to Dustin. Efficiency-through-software was dear to his heart as well, and we would stay up til 3am raving about how shortcut keys and high-level abstractions would Change The World. We shared a passion for technology, for entrepreneurship, and for using them to solve the same set of problems.

As our visions for how productivity software could work came into alignment, we thought about building it inside of Facebook. It was an attractive option in many ways, and neither of us was eager to exit a company that was in such an exciting phase of its development. But at some point it became clear that doing so wouldn’t be good for Facebook or for us. Facebook needs to continue its mission of making the world more open through social software, without distraction, and the new project requires a company built around it from the ground up, with the goals of efficiency and group collaboration embedded deeply into its DNA from day 1.

So we’ve decided to leave Facebook (in about a month) and start a new company, to build an extensible enterprise productivity suite, along with a high-level open-source software development toolkit, built for the Web from the ground up.

We see this new venture as very complimentary to Facebook. We hope our products will become to your work life what Facebook.com is to your social life. Our software will use Facebook Connect as the default option for identity and authentication. Our user interface will adopt many of Facebook’s conventions, creating a seamless and familiar experience for current Facebook users. And if our new development tools turn out to be useful, we hope the Facebook engineering team will come to adopt them.

Leaving Facebook makes me sad, but I feel I have to follow my passion on this. I can’t say enough about Facebook and the friends I’ve made here, and I am enormously excited for the company’s further success, a destiny I’m confident it will reach regardless of my participation in it. Finally, I’m really grateful to Mark, Chris Cox, Sheryl, Yishan, Chamath, Elliot, and others, who’ve been helping us make this a smooth transition, and to my family for guidance and support. Thank you; it’s meant a lot to me.

And the email from Moskovitz:

At various times in our progress, people have come up to me to deliver a now familiar question: “did you ever imagine Facebook would be this big?” And I give a familiar answer: “well… yea, actually”. Frankly, Mark and I knew even at the beginning this was something the world needed. We went into the college market as a stepping stone - identifying dense nests in the graph that would lead us to the rest of the world. We could see far enough in the future to know there would be an impact, we just didn’t know exactly what it would be. Now I can look back on our progress and see the ways the world has changed, the ways we have changed it. We’ve altered the future in a score of ways, from making it easier to look up phone numbers and email addresses to making it more difficult for terrorists to isolate impressionistic youth in the middle east. At the same time we’ve built a competent and vibrant organization, driven by a passion to push the world more open.

In the process of helping to build a company, I found I had another passion: making companies themselves run better. It’s easy to confuse this with a desire to manage, but even when I tried to do that I found myself drawn back to code for the solutions to my problems; I didn’t want to construct efficiencies, I wanted to engineer them. Communication is the key to scale in any size organization and technology is the key to communication. I’ve seen us unblock ourselves time and again with new tools to increase transparency and passive information flow and many times it was the fruit of my own labors. While working on improving Facebook’s tools, however, I came to a very difficult conclusion: doing this for all the companies of the world was not the same project as doing it for one of them. This idea is one that needs an organization that was built to do it, with every fiber of its DNA engineered in a way that producing an extensible enterprise platform becomes little more than the logical consequence of an organism executing its own nature. Further, the things we’ve scoped for Facebook’s product team to do are the right things to be doing and I wouldn’t have agreed with asking the company to divert significant resources to approach a project so different and so boundless in scope. Every time we introduce something new, we do it at an opportunity cost and this is too large a detour to take when we are already moving swiftly in the right direction.

And Facebook is moving in the right direction. When Facebook has a billion members (and 800 employees? maybe 900?) and someone leans over to ask me if I ever imagined it would get that big, my answer is going to be “you’re damn right I did. how come it only has 20% of the market?”. To know that this is Facebook’s future and decide not be a part of it is the hardest thing I’ve ever had to do, but it’s allowed me to have a broader perspective for the future. Like you, I’ve worried about the people leaving the company but it took becoming one of them to understand that this is just another part of the ecosystem (you should just take my word for it though). I’m not leaving the movement - I’m becoming a new part of it. The inevitable flux of the men and women behind these organizations is what moves the industry forward in the same direction in a way that cross-company collaboration alone never will. As the world moves to modular stacks and applications built up from a smorgasbord of platforms instead of single toolkits, then the companies that build the parts will need to act more and more like cooperative teams in a single larger organization. As Justin would undoubtedly say, I am simply viewing the industry from a different level of abstraction. These changes are difficult and sad, and that’s certainly an understatement for me… but change brings new things and this particular change will bring a new ally to our mission - I think we can all be pretty pumped about that.

Whether I work here or not, I’ll forever bleed Facebook blue. Facebook has been my passion and my purpose for the past 5 years. Our new project is not a replacement for what we build here, but instead both a complement and a compliment, and we have every intention of making it feel like a natural extension of Facebook’s product and purpose. Similarly, my timing in leaving is not an indication that I have lost faith in our ability to succeed, but an affirmation in my confidence in the company’s enduring success irrespective of changing faces.

Justin and I going to be around for at least another month and I am really looking forward to going deeper on this idea with everyone and how we can continue to work closely with Facebook. I’ll always be really proud of the work we’ve done and grateful for the opportunity to work with such a uniquely remarkable team. We’ll also be at the Q&A later to help continue the conversation right away.

Dustin

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Ok, it’s clever. Facebook added a translated version of the site today in honor of Talk Like A Pirate Day. But instead of seeing Facebook in French or Esperanto, you can see Facebook in “Pirate.” Just go here and select English (Pirate).

Your Profile is now “Me.” Your Friends are now “Me Hearties.” Your status box asks “What arrr ye doin’ right now?” Applications are now “Arrrrrplications.” Etc. And when you’re all done, you don’t log out. You “Abandon Ship.”

Well done.

Update: Google’s also getting into Talk Like A Pirate Day, pointing out that each year searches spike for the term, and noting that “ye c’n set Pirate as yer preferred lingo usin’ th’ Likes an’ Dislikes page.”

Update 2: VentureBeat reports that FriendFeed and others are also joining in the revelry.

Tim O’Reilly is going to be pissed.

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Don’t like the look of the new Facebook? Upset over last week’s mandatory changeover? You can do something about it, at least for now.

If you really want to keep Facebook the way it was, just add the Facebook Developer application here, and then click on over to facebook via this link. Voila! You’ve got the old Facebook look and feel, and you can change back any time (there’s a link at the top of every page.

This is probably a short term solution, so get your moments in with the old Facebook while you can. Who knows when this back door will be closed for good.

Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.

Researchers at Foundation for Research and Technology in Heraklion, Greece - that hotbed of Facebook research - have created a small Facebook application that causes a DDOS on a certain website. The application masquerades as a “picture of the day” app and shows an image from National Geographic. When someone clicks on it, however, it makes a request to a victim’s website, ultimately pulling down about 248 gigabytes of malicious data a day and essentially shutting down the server.

Obviously this application needs a perfect storm to be useful: you need to have a target and create a popular enough application that would encourage multiple installs. While one or two clicks won’t take down a site, the entire population of Facebook clicking on something definitely could.

The researchers wrote about the application in a detailed paper [PDF] and, by extrapolation, were able to tell how hard they could hit target servers provided, of course, the application was as popular as Super Wall or Bumper Sticker. They also recommend shoring up Facebook’s API to prevent this sort of mischief in the future.

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Facebook will tweak the user profile sometime tonight to let users fine tune the news items delivered to them on their home page. Currently users can filter news items to see top items, status updates, new photos and posted items from friends.

With the changes, users can opt to see application-specific news items (events, movies, Causes, etc.) or just see all news items without any filtering at all. Specific friends or friend groups can also be selected.

The importance of the news feed as a fresh content engine that brings users back over and over again each day isn’t lost on Facebook. They were the first major service to popularize the idea of a stream of news about a person, and haven’t been afraid to borrow good ideas along the way to make the product more compelling.

Now if we could just get a RSS feed of all those streams out of Facebook, they’d cement themselves as the permanent hub of all that data.

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If you’ve bothered to look at the ads on Facebook lately (don’t worry, nobody else looks at them either), you might have noticed little thumbs-up and thumbs-down icons at the bottom of each ad. If you click on one of these, a box pops up asking why you liked or didn’t like the ad. This presumably will help Facebook target ads at you more effectively in the future.

The ad-rating feature was quietly rolled at least two months ago. But it seems a bit redundant. After all, ads already come with a natural, built-in rating system. If an ad resonates with me, then I will click on it. If it doesn’t, I won’t.

But ads on social networks in general perform so poorly that perhaps Facebook is hoping to get some feedback from the 90-percent-plus of members who never click on a particular ad. In effect, Facebook is throwing up its arms and asking consumers diercty: why do our ads suck so much?

You’d think that Facebook members would have better things to do with their time than instruct Facebook on how to d a better job targeting ads. But then again, we are talking about Facebook.

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Facebook head of security Max Kelly, a former FBI computer forensics examiner, wrote a blog post tonight addressing the worm attacks on Facebook we wrote about earlier today. His advice to Facebook users: report suspected malware, and try not to share your password with anyone.

Kelly also says Facebook blocked the ability to link to the malicious website from anywhere on Facebook, although a black list approach like this is a never ending battle. The real solution on an individual level is to bail out of Windows to Mac or Linux where you are (relatively speaking) safe from these kinds of attacks. Of course, if too many of you do that, those operating systems will be targeted next.

A more general solution relies on an awareness campaign about these social hacks by the major sites like Facebook and MySpace. Eventually users will learn to avoid the newest trap, and the bad guys will be forced to invent yet more creative ways to get into your computer.

Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.

Update: Facebook responds to malware attacks.

Facebook malware attacks to date have largely consisted of getting user credentials via phishing sites and then spreading spam and additional phishing attempts. But a new worm is disseminating through Facebook that aims to install trojan software on a user’s machine.

The worm spreads when a compromised user’s account is used to send message to others with a title such as “LOL. You’ve been catched on hidden cam, yo:” and a link to a random URL. The linked website is a YouTube-like page that shows a video player along with what looks like a standard browser message to update your Flash installation. Clicking on the button begins a malware installation of a file called “codecsetup.exe.” We didn’t go so far as to install the software, but our guess is that it zombies your computer, installs a keylogger, and other fun stuff.

A nasty feature of the worm is that it takes the profile picture of the sending infected user and adds it to the linked website. This makes it all look much more legitimate for the potential victim. Facebook users are notoriously naive when it comes to security awareness, and a certain percentage of users will always end up falling for this kind of social hack. There’s little Facebook can do other than attempt to filter out the landing website in messages.

Screen shots below.

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Mike Schroepfer, the extremely well regarded VP Engineering at Mozilla, is now Facebook’s Director of Engineering.

He’ll be heading up Facebook Platform and the main product front end, he said by telephone this morning, although his exact scope of responsibility hasn’t been nailed down yet. He will report directly to CEO Mark Zuckerberg starting in September.

Schrep, as he is known, headed up the engineering team within Mozilla responsible for Firefox. Before that he was the CTO of Sun Microsystem’s data center automation division (responsible for the highly ambitious N1 project). In order to become a leading Internet platform, Facebook needs to inject more open-source DNA into its engineering ranks. Schrep should help it do that.

Since Mozilla won’t IPO, it could face more defections of top talent over time.

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I agree with Sam Gustin when he says that yesterday’s Facebook Developer Conference in San Francisco was in the end a snoozer, but not because CEO Mark Zuckerberg failed on stage.

First of all, saying the event itself was sleep-inducing is just factually incorrect. Before and after the keynote they played music so loud that a deaf person would complain. I was alarmed and somewhat panicked by the noise, but certainly not sleepy. And on a more serious note, Zuckerberg himself was much more at ease and charismatic on stage than I’ve ever seen him previously. He’s no Steve Jobs yet, but he’s no slouch, either.

I left the event feeling fairly upbeat about Facebook. They sent a clear message to developers that they need to build compelling apps and learn to play nice. And they created a clear reward and punishment system to deal with both ends of the spectrum.

But I’ve learned that I need period of reflection after these super-shows before I can really digest what happened. And after reflecting, I’m feeling more than a little let down by Facebook’s product focus and ability to execute.

Snatching Mediocrity From The Jaws Of Victory

A year ago Facebook set the Internet on fire with the launch of Facebook Platform. Competitors rushed to respond, and since then Facebook has been on a tear.

Facebook has all the momentum as the worlds largest social network (if not the most valuable), and they’ve always been willing to launch bold and controversial new products that change the way people perceive the company (News Feeds, Platform, Beacon).

Everyone looks to them to see what comes next. When rumors surfaced in May that they were going to announce Facebook Connect, a way for third party sites to integrate their services with Facebook profile data, Google and MySpace rushed to announce their own versions of the product, with nearly identical features and, in the case of Google (Friend Connect), a suspiciously similar name.

But today they were not bold, and they did not act like thought leaders. There was no controversial but exciting new product experiment unleashed on a gushing audience. Instead, there were minor tweaks to a platform that needs a major overhaul.

Facebook Connect, the most exciting new product on the agenda, is still vaporware. A parade of partners came out on stage to talk about all the great things they’ll do when it eventually launches this Fall. Meanwhile, Google’s product is in working alpha, and MySpace has fully launched Data Availability.

The new three tier ranking system for apps, which we first wrote about in March, addresses the problem of black hat developers, but it may create more pain than it’s worth. Developers have long complained that Facebook plays favorites.

More disappointing is what Facebook didn’t announce today. No payments platform, even though developers are begging for a way to make money beyond pitifully-low (and falling) CPM ads.

Nor did Facebook address their now quaint and basically unusable messaging system, even though MySpace paved the way for them by implementing Gears nearly two months ago.

Facebook also didn’t take the opportunity today to make amends with Google and cross-integrate their products. Competition is fine, but users are best served with interoperable products. In effect, Facebook is continuing to tell their users exactly what they can and cannot do with their own data.

Finally, Facebook chastised developers who build slow applications, telling them that they need to speed things up and think about scaling. But user complaints about the slowness of Facebook in general are on the upswing. Perhaps its time for the company to listen to its own advice.

Suddenly Facebook is acting more like a company with lots to lose (and therefore defend) rather than a scrappy young underdog startup looking to shake things up, capture our imagination and change the world. It’s time for them to be audacious again, and take some risk. Otherwise, they risk becoming simply boring. And that’s the fast lane to mediocrity.

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Facebook just issued the press release for today’s F8 conference. The release is below, with the most important points bolded.:

SAN FRANCISCO, Calif. – Facebook f8 Conference, July 23, 2008 – Facebook today introduced the latest advancements to Facebook Platform during its annual f8 developer conference, calling on its more than 400,000 developers to connect their Websites with Facebook through Facebook Connect, extend their applications to dozens of languages worldwide, and make use of new developer resources to help them succeed.

“We opened Facebook Platform with a belief that community innovation can give people the tools, and the power, to share and communicate in ways that Facebook can’t build on its own. We’re humbled by what our developer community has accomplished,” said Mark Zuckerberg, founder and CEO of Facebook. “We’re confident that the changes we’re presenting today help developers build more meaningful social applications that enable users to share more information.”

Facebook earlier this week released its new site design for users to preview and test, which is being gradually rolled out to Facebook’s more than 90 million active users over the coming weeks. The changes announced today, along with those launched earlier this week, leverage Facebook’s powerful feed system to give developers a new way to gain visibility and help users share and discover more information.

Leveraging the Power of Feeds

“Across the Web, content creation has become easier and more immediate, resulting in a continuous stream of information through what we call ‘feeds’,” said Zuckerberg. “The power of feeds on Facebook is their ability to move you into a world where you receive relevant information in a social context wherever you are on the Web.”

The new site design emphasizes dynamic content and surfaces the most recent and relevant information and activity through feeds, both on News Feed and the Wall. For developers, the new site design enables even deeper integration within the profile for their applications. By taking advantage of the improvements with feeds on Facebook and the other new features, developers can more efficiently distribute their applications and gain more ways to engage meaningfully with users.

“We’re confident that the new profile and integration points will give entrepreneurs and developers even greater opportunities to build their businesses and deliver on the promise of Facebook Platform,” said Ben Ling, director of platform program management, Facebook. “One goal of the new site design is to align Facebook Platform with users’ interests who will see a new class of applications emerge that provide deeper engagement and a better experience.”

Making the Web More Social with Facebook Connect

Facebook announced that 24 Web sites and applications have joined its efforts to make the Web more open and connected through Facebook Connect. A developer ‘sandbox’ is now available so developers worldwide can start working with Facebook Connect.

Facebook believes that enabling users to take their identity and friends with them around the Web, while trusting that their privacy is protected, makes the Web more open and connected. Facebook Connect allows users to bring their Facebook account information, friends and privacy to any third party website, desktop application or device.

Digg, Six Apart, and Citysearch were featured live during Zuckerberg’s keynote today demonstrating their planned implementations of Facebook Connect. Facebook Connect will be generally available to users in the fall.

“Digg surfaces the best content on the Web as voted on by its community of 26 million,” said Kevin Rose, founder of Digg. “Facebook Connect will help us promote more conversations on Digg by giving Facebook’s 90 million users an opportunity to sign-in to Digg with their Facebook accounts and become part of the active Digg community. This allows both Facebook and Digg users to more easily share the content they care about with the people they care about.”

With Facebook Connect, users benefit from the following features:

• Trusted Authentication – easily authenticate into partner sites using their Facebook account

• Real Identity – leverage their real identity across the Web in a trusted environment

• Friend Linking – take their friends with them wherever they go, enabling trusted social context anywhere on the Web

• Dynamic Privacy – assurance that the same privacy settings users have set up on Facebook will follow them wherever they decide to login throughout the Web

• Social Distribution – share actions on partner sites with their friends back on Facebook through feeds Additional planned participants at launch include: Amiando, CBS.com, CNET, CollegeHumor, Disney-ABC Television Group, Evite, Flock, Hulu, Kongregate, Loopt, Plaxo, Radar, Red Bull, Seesmic, Socialthing!, StumbleUpon, The Insider, Twitter, Uber, Vimeo and Xobni.

Expanding Facebook Platform Internationally

As a result of the worldwide success of Facebook’s translation system, the company has opened up the Translation Application to any developer using Facebook Platform. Beginning today, any Facebook developer can make their application available in any of the 20 languages that are currently available on Facebook, with 69 more coming soon.

Developers can now access the Translation Application to either translate their applications themselves, or open up translation of their application to Facebook users around the world, who will work together to define it in their native languages.

This innovative approach combines the passion of Facebook users with technologies that are systematic and manageable. The Translation Application enables developers to get high-quality, fully-translated applications in front of users, no matter where they live or what language they speak – much faster than ever before, and without ever having to pick up a dictionary.

“Through Facebook’s international platform, the possibilities are endless for both developers and users,” said Chamath Palihapitiya, vice president of growth, Facebook. “With no language barriers to break through, developers can take the stage with an even larger audience of users from all over the world, and users will have access to even more great applications than ever before built by the world’s best developers.”

Helping Developers Succeed

When Facebook Platform launched in 2007, it gave developers the opportunity to create applications that are deeply social and meaningful to users. More than 400,000 developers and entrepreneurs from 160 countries have signed up and developed applications. For the next phase of Platform, Facebook has focused on ensuring that developers have the resources and incentives they need to build applications that deliver on the vision of Facebook Platform.

Facebook launched four new and expanded developer programs and resources:

1) Great Apps Program Facebook’s Great Apps program rewards applications that deliver value to users and advance the Facebook Platform vision. Great Apps embody Facebook’s guiding principles for social applications through their meaningful, trustworthy and well-designed user experiences. Great Apps will gain greater visibility on Facebook, earlier access to new features and more feedback from Facebook. Facebook will open the Great Apps selection process to developers in September.

Facebook is excited to announce iLike and Causes as the inaugural Great Apps. “Facebook Platform provided iLike with an unprecedented opportunity to become one of the world’s leading online music services in just over a year,” said Ali Partovi, CEO of iLike. “I’m delighted that Facebook is committed to recognizing the apps that are most appreciated by users. We expect the Great Apps program to have a very positive impact on the entire Facebook Platform ecosystem.”

“The Causes application enables socially-conscious Facebook users to unlock the power of their social network in order to raise money and awareness for the causes they care about,” said Sean Parker, chairman and co-founder of Causes. “With more than 100,000 causes created by 12 million Facebook users, we’ve had remarkable success building user trust and value on Facebook and we’re excited to join the Great Apps program.”

2) Application Verification Facebook is introducing the Application Verification program which is designed to offer extra assurances to help users identify applications they can trust — applications that are secure, respectful and transparent, and have demonstrated commitment to compliance with Platform policies. Verified applications will benefit from added visibility on Facebook. The program is a complement to Facebook’s ongoing policy enforcement to keep the Platform ecosystem robust, and will be open to developers in September.

3) Expanded fbFund Competition In an effort to grow the Facebook ecosystem, fbFund was introduced last year to provide resources to developers, by eliminating some of the challenges of starting a company. As part of a new competition, Facebook will award nearly $10 million in non-recourse grants to the top 25 applications. In addition to the Facebook judging committee, this year users will test applications and vote on their favorites after the first round deadline of August 29, 2008.

Winners from the first fbFund competition were announced today and include: ConnectedWeddings, CourseFeed by Classtop, GoalCamp, HotBerry, J2Play, LuckyCal, MyListo, Podclass, Trazzler, and Zimride Carpool App.

4) New Developer Website Facebook is introducing a new website for Facebook Platform. Improvements include better navigation and cleaner access to the blog, wiki and forum to encourage community involvement. Facebook will also start highlighting social, meaningful and trustworthy application case studies.

For additional information on the announcements made today at f8, please visit the f8 Press Page at: www.facebook.com/f808Press.

About Facebook Founded in February 2004, Facebook’s mission is to give people the power to share and make the world more open and connected. Anyone can sign up for Facebook and interact with the people they know in a trusted environment. Facebook is a privately-held company and is headquartered in Palo Alto, Calif.

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