It could hurt Google, but Google's biggest draw is their search PPC, which would not be effected outright. Google DoubleClick and extended networks will likely be effected (Adsense.) It could effect their PPC or CPM prices.
I welcome all competition, I frankly have found Google's dominance in this space to be frightening. I never understood how both Microsoft and Yahoo failed so miserably in this space. It's still possible that Facebook could fail here too, but they have more data and a huge advertising base that they can draw from. Something Microsoft and Yahoo didn't have...though they did have big advertisers, it was hard to get the SMBs, etc.
I welcome all competition, I frankly have found Google's dominance in this space to be frightening. I never understood how both Microsoft and Yahoo failed so miserably in this space. It's still possible that Facebook could fail here too, but they have more data and a huge advertising base that they can draw from. Something Microsoft and Yahoo didn't have...though they did have big advertisers, it was hard to get the SMBs, etc.