The biggest issue I have with facebook is its simplification of peoples different friendship groups. I want to have a friends group, hobbies group, family group and co-workers group and be able to control which content is visible to each of them, which groups people are in etc.
I don't like the way facebook is so cluttered and full of crap; the main thing that gets people to signup with facebook is having all their friends there, not all the rubbish games etc.
More geo-location integration allowing you to share what you do and where you do it. Share this information with certain groups of contacts. For example, say you were going back to your hometown for a weekend you could set up an event that would allow people to see you are coming to town and update them with where you are etc so they can join you on a night out etc.
Rather than the event organiser setting up an event and posting it to certain people, they say if they are accepting the invite etc, you would just set up that event, any friends that have access to the event would just see it and could subscribe to it and they would receive updates as to where you are when you are in town if you have a smartphone etc.
Basically focus on useful functionality rather than pointless time wasting things which seems to be a large part of facebook now.
Edit: Just saw about circles, tempted to disbelieve it as its from the metro but if its on googles twitter then its probably correct. Still stand by my statement that facebook is not that great though. Keep going OP!