Facebook is bringing us back Beacon again. According to Nick over at All Facebook Beacon had not really disappeared. It was just less intrusively in sight. A little storm appeared on Techmeme over it.. For the very few of you that failed to hear about Beacon before. It’s Facebook;s attempt to monetize the user data and social graph from their 100Mln users. Facebook is, just like almost any other web 2.0 site, unable to create enough advertisement revenues to justify their $15Bln valuation. Beacon is their attempt to create more advertisement revenues.
Personally I believe that the future of on-line advertisement lies outside of social networks. If I’m connecting with friends, whether I know them in real-life or just on-line, there is no room for advertisement. It sits in the way of our interaction, adding zero value to the conversation. I don’t see the difference between on-line or real-life behavior.
Let’s make this Beacon and other social advertisement projects a bit more practical and project it to your normal life. What would you do if you found out that while you were sitting at your rented home taking to a friend, the house owner is recording your conversation, your relationship with this friend, the way you have decorated your home, what movies you like, what political views you have, the coffee brand you are using. What if that house owner takes all this information from you and then uses it to provide you a better advertisement experience? Would you enjoy the commercial message? Think wow, what a cool brand, this is just what I need? Glad that I know this house owner who brings me this cool stuff?
Somehow I doubt that. More likely you would either sue the house owner for breaking in to your privacy. Or, you might find your copy of the rental agreement only to find out that somewhere on page 12, buried deep in incomprehensible juridical language it says that the house owner is allowed to do all this. Would you stay in that house? Or get out of there to find a place that is yours?
People often react a bit uncomfortable when I provide this example. I am always surprised how little people understand about the way they are tracked and traced on-line. I’m also amazed to find that tech savvy people often don’t seem to mind. We seem to have a fait accompli attitude towards free ad based business models. You get stuff for free right, so don’t complain about it. I find that attitude dissatisfying. As if there are no alternatives and we just have to live with it.
So why do we not accept this in real life but are we willing to be tracked and traced on-line? I believe that there are two basic reasons for this behavior.
Facebook does this particularly well. They provide you privacy controls to set your privacy level. This provides any naive user the comfortable feeling that he and his privacy are safe with Facebook. But what this user doesn’t seem to understand is that Facebook merely provides you privacy controls against third parties. The question no one ever asks or gets answered is, “who is protecting you from Facebook”?
The answer is no one of course. Facebook offers privacy controls for everything but Facebook. Once you sign on your soul is theirs, and they get to commercialize it any way they can. They tell marketeers that a new era has begun in advertisement. Marketeers see advertisement wet dream appearing (what do they know, marketeers are idiots). The user is left in ignorance, providing him a false sense of security as Facebook protects their privacy. And in the end old school advertisers get to pay for this mess as users continue to ignore advertisement that provides them no value. A great business model. Such a waist of energy, of creativity, of user value and of advertisement money spend.
Privacy is the most under discussed, underestimated and undervalued theme of what we now call web 2.0. Even Tim O’Reilly feels that we’re not doing ourselves a favor with these business models. But I would take it one step further. if Tim gets his way data will be the future. But who is going to control that data? If we go on like this it sure isn’t going to be the user. No one is building services that help the user get a grip on his digital tracks. There is no business model for it. We need to open up, give the fellows even more data to ensure that they can all live a prosperous and wealthy live as web service owners.
I’d like people to challenge that line of thinking. We need think more about privacy and start thinking user value. We need developers to build tools that help users control their privacy. And we need entrepreneurs ad investors that build user value based business models. Chris Messina provides a good example of this line of thinking in his Diso project. He is doing the right things there.
I am a bit behind on my reading. While I finished this post I noticed that Skott Karp has a very similar post up now in which he questions why Facebook doesn’t make more advertisement revenues. His conclusion is the same as mine. Advertisement doesn’t provide the user any value in social interaction.