From what I've read it searches your universe of friends for certain criteria. Let's say I have 10 friends on FB. Why in the world would I want to search across only 10 people? FB is such a pain to use. Why login to FB when I can get more than everything I want easily from Google, Yelp, Yahoo or Youtube.
Unless they go for search and challange Google, this will fade as fast as Instagram. So far, regardless of price ans expectation of what FB might deliever: Facebook is and will remain a social medium where ppl use it mainly for keeping in touch with friends. Everything that has been included in the shareprice has been included. From here on its down.