Oh what a difference a year makes.

Last year when Mark Zuckerberg took the stage at the Palace Hotel in San Francisco to talk about his wildly popular Web site Facebook, the excitement was palpable and the expectations high. Microsoft was set to invest $240 million for a tiny stake in the social networking site, which valued the company at a whopping $15 billion.

On Thursday, Zuckerberg skirted the question of whether Microsoft overpaid, given the gut-wrenching drop in stock values over the past year. And rather than fielding upbeat questions about how fast he could expand Facebook's work force -- it has grown from 300 to 700 employees as he predicted last year -- Zuckerberg was asked if the company had implemented a hiring freeze because of the downturn.

"We're continuing to hire good people," Zuckerberg said, but without much enthusiasm.

The Web 2.0 Summit, which is a gathering of the Internet's most influential personalities, had a noticeably more grim mood than last year's. It is co-produced by Sebastopol-based O'Reilly Media and San Francisco-based TechWeb.

Typically, these tech conferences are full of eager entrepreneurs vying for the time of well-heeled venture capitalists who can inject millions of dollars with little more than a "yes."

And while that certainly was still a part of this year's conference, the over-caffeinated giddiness so common in past years has been noticeably absent at the three-day conference, which ends today.

Instead, topics focused on how the world can dig itself out of a global-warming disaster and how some of the Internet's fastest-growing tools, such as Twitter, can become profitable.

Evan Williams, CEO of Twitter, hinted at how his micro-messaging Internet tool might cash in on its rapidly growing user base. He suggested that Twitter might charge businesses to set up authenticated accounts.

Already companies such as Comcast and Sonoma County Internet service provider Sonic.net use Twitter to deliver product information, and to aid in customer service. Twitter is like instant messaging, but it is broadcast to anyone who follows your account and the messages must be 140 characters or shorter.

Williams said companies will be able to feed information such as special offers and discounts to people who opt to follow their Twitter accounts.

Developing a revenue model is not a major concern, Williams told onstage interviewer John Battelle.

"I don't think it is as a big a dilemma as people think it is," Williams said. "It won't be hard to monetize."

Despite Williams' optimism, harsh realities face the tech sector. Startups such as Pandora -- the online radio station -- and others have been slashing costs and laying off employees. Sequoia Capital, one of Silicon Valley's best-known venture capital firms, sent out a 56-page slideshow to its companies illustrating the stark realities of the economic downturn and instructing them to cut budgets.

Battelle, a journalist who founded Federated Media to pair bloggers with advertisers, said companies are scaling back plans made last year when it looked like online advertising would continue to grow 30 percent a year.

"A lot of companies were built for an economy that was expanding rapidly," he said. "It's a bad time. Advertising is down badly across the economy."

However, Battelle was quick to point out that online advertising is still expected to grow by double digits, according to analysts. And risk is always part of being a startup company.