Social Networking is nothing new, and is still inherently useless. It's somewhat good at keeping in contact with people, but largely there is no contact between people using it. People stay 'in contact' by reading other peoples facebook status updates, not actually talking to them.

I met my wife through the internet, but she was a friend of a friend. Ask most couples how they met and a lot will say they were introduced by a friend. How do I say it? Well I was introduced by a friend!

Social Networking allows people to spend less time talking to people and still feel somewhat connected. There's no use in it except staving off the loss of a friend. I cut all my friends when I left high school, I moved country and I live in Canada. I don't miss a single friend from back in England, 99% of them were people who I'd have on a facebook account and completely avoid talking to.

The way to make social networking sites profitable, is to make people use them frequently enough without draining resources. Google makes a lot of money, because the data use by a single user is tiny. The data use by a Facebook user is huge, my wife probably uses 10 megs of bandwidth every time she checks the site. Yet everytime she hits google, she probably uses 10k of bandwidth from a google server to get where she wants to go.

To extend your argument, you make money on it the same way as you do for those things that have been around forever. For jobs and dating, listing fees. For search, search marketing. And using the social graph to better target ads should increase CPMs by much more than content-based targeting.