MySpace has over 200 Mln registered users. Facebook follows fast with 140Mln registered users, and they are adding an astonishing 600.ooo new users every day. A rough estimate suggests that more than half a Billion people are registered in social networks worldwide. That is half of the entire Internet population. Clearly there is a need to be participating in social networks. The need is interaction.
While social networks undoubtedly have brought us many great things I find that the current setup is undesirable. Techies might consider Facebook and MySpace web 2.0, but their strategy is very much 1.0. They are silo’s. You are either in, or out. Or as Doc Searl puts it, Facebook is the Borg. Once in, it is hard to get out. You should realise that it isn’t Mark Zuckerberg or a talented developer providing you cool features that keeps you locked inside a social network. It is their choice of business model. MySpace and Facebook have only one mission, and that is to become the single silo everyone uses as their communication platform on the web. It allows them to execute their free, advertisement based business model. In this business model the network is more important than the user. In other words, the business model becomes more effective when the number of users increase. This is not to be mistaken from the network effect Tim O’Reilly often speaks about in referral to web 2.0 services. Web 2.0 services improve as more people join, in other words, the quality of the service improve as more people use it. In the case of the free advertisement based business model the revenue stream increases when more users are joining, but the overall value provided to the individual user is not 1-1 related to the number of users.
For that reason social networks make it super simple for you to add new friends. At the same time it is nearly impossible to leave the network, taking your data with you. And it is a service violation to export your Facebook contacts to another service. Getting in is easy, leaving is out of the question.
In order to keep the silo the most important platform, new services are added all the time. Facebook is not just a social network anymore, it is a platform of services. It provides users so much functionality that there seems to be no reason leaving it once you are in. A whole generation is now growing up thinking that Facebook is the Internet. And while Facebook and other social networks continue to add new services making this sound very reasonable I see a few reasons why this is undesirable:
- There should not be a single company having so much power over our web experience. Especially if such a company leverages our (private) data in their business model. Diversification is good, building one platform and closing everyone into that platform sounds more like an old fashioned communist-like scheme to me
- Privacy needs to be controlled by the user, it should never be controlled by the company that exploits all data and interactions of that very user
- People are largely ignorant about possible dangers of the information they are sharing through social networks
- The business model involved is mostly destructive as hardly any value is created. Facebook has a gazillion pageviews every day. While we are interacting with our friends, they display advertisement to us, thus trespassing through our relationships. The advertisement is largely ignored by all of us. No value creation there. And the sucker that ends up paying for this “value”? The advertiser, unaware of the bottomless hole he is throwing his money into.
Social networks are there for our desire to interact. But that interaction comes at a cost, we lose our privacy and diversity. While that might not sound like a big deal now I believe that in the end this will not be beneficial and even dangerous for us. The nearly unlimited growth of social networks will stop at some point. As we are all on MySpace or Facebook, it will become less valuable and cool to be part of it. Human nature simply doesn’t like captivity.
@vanelsas 
Alexander,
Great post!
You mentioned the fact that if you leave facebook, you can’t export your data. Haven’t thought of that yet and that’s quite disturbing. Not that I want to be an exclusive ‘owner’ of my data I leave on Facebook, but whoever switched cellphones or bought a new computer know the pain of lost data/contacts. I sincerely hope facebook acknowledges that fact.
Regarding the ignorance of most users about the dangers of sharing information online… there always will be people who are prone to being suckered into something and some who don’t. And even those who don’t can get themselves fooled. But I don’t see a difference between real life deals. The financial mess some people in is something similar. Not providing of information and not demanding of information.
grtz
Tom
@Tom there are numerous cases documented where users would scrape their contacts from Facebook into another application and then got their account disabled by Facebook (it’s against policy). A well known case is Robert Scoble who tried to import his stuff into plaxo.
Wrt the ignorance. I always try to think about a physical metaphore. Facebook is a landlord that might let you stay in your house for free. In return the landlord records all your interactions and movements within the house with you and your friends. And he uses that information to provide you in-house advertisement. People are not aware that when they set privacy within Facebook they are not protected from Facebook. We store photo’s, tag them (see the nr of photo’s of families with children), we interact with friends and family, and all of that info is stored for commercial use. It is not the same as in real life, this is much more hidden and people simply do not understand the dangers of this.
Facebook and Myspace do have too much power on some users web lives. It’s not just the control of the data, but the control of the types of groups and applications that are allowd. Personally I am looking forward to some movement forward in the world of distributed social networks built on the back of blogs…
When discussing power on the web it is impossible not to think of Google. Whilst I have always been against SEO beyond the most simple ‘make sure it can be crawled’, people are now obsessed by Google Optimization, after all, with 80% of searches (at least in the West) you have to do things their way.
@Alexander I still think people are largely responsible for their own actions. Otherwise you get stuck in a litigation-obsessed world like the US or the UK. I’m not denying that facebook could communicate their privacy statement more clearer, but a lot of people could start by just reading it. If people complain and haven’t read it… who’s to blame? Regardless of what it says, the initial mistake lies within the user who just doesn’t care, not within the application. People need to be re-educated in regard to protecting their privacy, but that’s not something facebook should do imo.
@David (and @Alexander) The power of Google is undeniable. I can’t even fathom the information they store and what they could do with it. But it seems that with all the doomsday reports about abuse or misuse Google has been a more or less ‘clean’ company.
@Tom, I agree up to a certain point. Communication is crucial. Providing a 30 page terms of use policy with unreadable text isn’t the way to go. But if we forget about that, my main issue is that the chosen business model forces these companies to exploit the user, his relations and his data. A company that has a business model based upon user value instead of network value, would not have privacy issues. They would provide the user easy to use privacy controls, and not exploit the user and his interactions.
@David Google falls into that category as well, especially when you are logged into a Google account
Alexander, I was just thinking this morning, “What do you do if a walled garden is bigger than the wilds outside of the walls?” That’s definitely how I am starting to feel about Facebook. I used to think that their closed system was bad.. but at the rate it is going, everything on the outside is going to be on the fringe, looking in.
@phil, that is the overall strategy isn’t it. Growth over value. I wrote a post about that a few days ago. I said there: Facebook may become a next ‘smoking’ addiction. It’s really cool when you sign up, but once you realize the potential harm, it is nearly impossible to quit.
Just because everybody is on it doesn’t mean it is right.
@Alexander This is really interesting stuff as I don’t see where you can properly draw the line between the responsibilities of the user and those of the application. We should all focus on it, but if we do this too much I’m afraid we’re going to get stuck into a world governed (and punished) by rules. I always like to use the metaphore of people complaining about their current governement but who didn’t went out to vote.
On the other hand, just because they based their business model on numbers, I reckon 2009 will be the year Facebook will be over the top and done with (maybe 2010, I’m not in the prediction business). But what they do is basically, like you said, sell air to companies who just want to join in. These models fade out quickly to be replaced by the next new thing. Though everyone likes to say there’s no limit to what’s possible, if you play by numbers, you can lose by those same numbers too.
@Tom, the line seems simple to me. Give me control and responsibility over my privacy and then I’m fine with it. I might give away all my privacy, but it should be my call, not the service owner’s call.
Right now I can set privacy but it only keeps competitors out. No one is protecting me from Facebook or any service executing that same business model for that matter. All a user can do now is not join 😉
@Alexander But nobody asks control (except the few, and believe me, I don’t argue your point, I want these things too). My point of view is that change has to start from the customer, not from the company. If the customer gets educated in being aware what happens with data they give, or what could happen, so re-educate them, than companies will follow. Why should companies change privacy statements if no-one reads them? Than no-one will become wiser. If Facebook changes it’s statement for the best, most people won’t care and if the next Facebook pops up with a ‘bad’ privacy statement no-one will know the difference.
@Tom, glad we agree 😉 I’m afraid the business model sits in the way. They could not easily make that switch as it would mean that when I choose privacy, Facebook cannot access my data. And that doesn’t fit the advertisement model. So the issue isn’t really the policy, it is the core business model that exploits user data, relations and interactions for advertisement.
Simple example. Having Amazon provide you the advice to buy the “Complete Illustrated Kamasutra” based upon previous behavior might be convenient. After having bought the book and then seeing your friends getting an update in their Facebook newsfeed that you just bought the “Complete Illustrated Kamasutra” is most likely an unpleasant surprise 😉
Well, there’s an even more bothersome issue: in theory you can’t close your account, ever, unless they do it for you.
However, there’s a simple trick when you want to leave Facebook for good.
1. The boring way: you may want to delete all entries, one by one.. tedious, very. Hours of nerves pulling. Have you ever tried? There is NO way you can select ALL entries and press “delete”. It’s one by one or nothing. Everything. Any single bit. ANd the make a request to close the account. It sometimes work, I’ve heard.
2. The fun way: turn your profile into a pile of crap (a) you first delete all your friends (b) you change the profile’s name – you can do that (c) you fill it up with offensive content- texts, porn pics and all (d) you state clearly that FaceBook employees are just a bunch of -beep -beep -beep – fill in the beeps with the most politically incorrect insults.. (e) you invite lots of randomly picked people to become your “friends”.
When you wake up the next day, your profile is gone. For good. Amen.
@Olivier G lol 😉
@Alexander Owkay… I’m changing all my accounts :). I Totally agree the misuse of data, but rather see the initiative from the customer.
Really great post… lots of stuff to think about.
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Olivier: I wish I’d thought of that second approach when I asked Amazon to close my account. I thought they would delete it as well, but apparently their idea of closing an account is to deactivate the password. So now all the personal stuff I wanted to delete for privacy reasons is still online and I can’t get to it! I’ve asked them to reactivate the account long enough for me to delete the information myself, but so far they haven’t responded.
(Postscript) A few e-mails later we got things straightened out and they removed my stuff themselves… scared me a bit for a while, but at least it ended well.