Most innovations typically play along the periphery of what is permitted because the norm is, by definition, in the middle. By its very nature, social networking runs contrary to U.S. constitutional rights to privacy. That doesn't stop facebook's popularity but I guess that it could cause any large corporation's legal department to blow a gasket. As a participant in an enterprise offering in social networking, I've run in to the opposite end of this spectrum. Companies don't want to reveal their internal problems yet risk doing so as they start searching around in social networks not directly under their control.
Dinosaurs aren't extinct. They've just learned to hide in the trees.