I don't have a Facebook, and I doubt I ever will. I hear it's cool and it looks interesting from what I've seen, but MySpace and AO take up too much of my time as it is. WAY too much of my time, in certain cases.
The whole purpose of Facebook and MySpace is mainly networking. Keep in touch with old friends or friends who've moved away. Or, informing people in your network of various events and parties and such; like Legend said. It's also a great tool to get your art, music, business out there. I've seen all sorts of different businesses advertising on or utilizing MySpace. From comic book stores to adult "fun stores". From Coorporate America to "The Little Guy".
On the other hand. Most people are on MySpace just to be on. There are plenty of students who's grades have dropped due to spending time on MySpace instead of doin' homework. Many of workers are fired because they take it upon themselves to use the company computers to log on to MySpace/Facebook. They do a good job (MS/FB) of sucking people dry, in my opinion. I know I've fallen in to "do nothing but MySpace" mode quite a few times. But then again. You guys here at AO do a good job of wasting my time too, LOL. I like it though.