Facebook is one of the fastest growing websites to ever exist. It took what MySpace and Friendster were, and made it a far more general tool for staying "connected" with friends (old and new), family, and co-workers.
The entire concept of online social networking is genius. Facebook was established as a way for a user to show the people they know a little about themselves; whether it be pictures, opinions, or their interests in general. Basically, it's a short-hand version of your own blog, but more emphasis on knowing the person behind the blog (the profile). More often than not, the person is already going to know the user in some sort of personal-physical connection anyways.