Facebook is a social networking site located at facebook.com. Facebook was founded in 2004, originally as a site for college students to network. It has grown exponentially since, to include any type of person looking to network in just about any way (people they know or people they don't know).
Facebook 'apps' (applications) didn't become overwhelmingly popular until 2008, when various games started showing up. Restaurant City by Playfish went into public beta in late 2008/early 2009 (need clarification).