Social web marketing is a fabulous way to promote your business - and even a better tool to promote your own web site. It`s better to start with your own domain - and incoporate the social web site marketing into your plan. There are a ton of free places to set up a web page to position yourself as an expert in your field and move traffic to your own site.
You will have a higher profit marging working off your own domain.. By all means use all the free tools out there - but position your site in the middle of it all.
I agree social networking sites are great and a great way to promote your product/service/yourself and the hottest way to spread the word.
The effective way to use such sites is to promote, create some buzz... not to use them as your only/main website presence.
There is value in having your own domain name and website rather than a subset of squidoo, youtube, etc.