It’s not really news to anyone at this point, but the much anticipated Facebook IPO has been a big letdown for almost everybody involved. Of course, we think it began with Nasdaq’s monumental big trading desk communication breakdown, but Reuters is now reporting that things were headed south early last week during the IPO roadshow.

Apparently Morgan Stanley’s Scott Devitt, the bank’s consumer Internet analyst, was in the process of reducing Facebook’s revenuer forecast just days before the IPO actually kicked off. The discovery of lower than expected revenue growth coincided with Facebook updating their SEC S-1 stating that users rapid shift to mobile was a threat to earnings.

So the end result was that many investors at the big banks had knowledge that Facebook was expected to perform poorer than previously expected, but many other investors were left in the dark. The drastic cuts came not only from Facebook’s quarterly earnings forecast but also the year-long projections as well. The main gist of commentary from hedge fund managers and seasoned veterans of tech IPO’s suggests that it is highly unusual for revenue projections to change so dramatically once an investor roadshow is underway.

Here’s a collection of quotes from insiders who chose not to be identified regarding the Facebook IPO and all of this decreased forecast nonsense:

“This was done during the roadshow – I’ve never seen that before in 10 years,”

“It’s very rare to cut forecasts in the middle of the IPO process,”

“That deceleration freaked a lot of people out,”

It’s a little confusing on if anybody really did anything wrong, but it’s clear that many investors were scared off by poor projections, while others were left completely in the dark. I guess the real mystery will come on Facebook’s end. Will they overcome their mobile advertising challenge or succumb to the fate laid out for them in the financial forecasts. The Securities and Exchange Commission is investigating other issues surrounding the IPO and I am sure the revenue forecasts will pop up their radar during the course of those inquiries.