We've seen the future and the future is now! The underlying drive behind any social networks site is to generate profits. Do members/users of sites such as Facebook, MySpace, Friendster, etc...think that individuals and corporate patrons have merely "donated" capital for the end users pure amusement of social networking? Wrong!
These sites have extremely well thought out 5 to 10 year plans which are ultimately geared toward revenue generation either through targeted ads at members based upon freely given information in their profiles and/or activities or through selling of users information to third parties. Many of the members of these site have never taken the time to read through the EULA which govern how their information is to be used.
However, users are waking up. We've already seen the backlash from Facebook's ill-conceived Beacon program which caused a user uprising not seen since the airline/TSA cooperation scandal involving passenger information. Although in the Facebook instance users brought the initiative to a halt unlike TSA's CAPPS II program which is still in place today.
The fact is that people today have adjusted to the reality that their online actions are not private and they willingly trade off a piece of themselves to play the big sandbox that is known as the World Wide Web.
If it shoves pop-ups, banners and video streamed aliens down our throats, people will go elsewhere to network. If it "targets" users with "more relevant" ads through semantic tools, they will go elsewhere.
Spam. i've already begun to stop using my facebook account as much. It looks to be going the way of myspace, with personal pages, and pages set up for companies and organizations. All it was to me was a way to keep in touch with college and high school friends, now it's trying to be so much more.
The goal of being profitable is the goal of every company and it's the right thing for Facebook to do. Now culture, I don't believe, has to change because being a successful company was the goal at the beginning and would still be the goal now.
I don't get spammed by Facebook and I've actually clicked on a few ads. The way I would try get profitable would be to see about lowering operating expenses first and streamlining the operations of the backend. Next, I think profitability should become not just the goal of Facebook but they should extend that goal to include the users of Facebook somehow. Lastly, they are on the right course with Pages. Everyone on Facebook is a fan of something or someone and therefore they can leverage their userbase in that regard.
Facebook, like MYSPACE, are sites that eventually are going to need to expand their range or they will suffer from upcoming competition. Social Networks are important as a whole, but for the individual - these networks are not important at all. unless there are ways for people to capitalize on these sites - these sites will just be the BBS's of yesterYear!
makes me wonder if this can be changed in an evolutionary way at all versus baking the financial model in right from the start (i.e. fast company's article on ning this month)
so wait...why are we changing facebook? isnt it just a tool to keep in touch with ppl and update them on whats going on in our lives? Why are there companies wanting to profit from this? It's not broken, don't fix it.
I really don't know how any of these social networks expect to make money off traditional advertising. Targeted ads based on personal information sounds good, except that people don't come to Facebook to actively look to be marketed to. This is why we see such low CPMs on sites like Facebook and MySpace. The whole branded page idea is bad too since users have to actively look for these pages and groups in order to find them, and as I mentioned that is just not what people come to social networks to do.
In fact these social networks basically give away their best advertising channel for free, applications. There is a reason why branded pages and groups have comparatively low member numbers when compared to the most popular social network applications, and that reason is because applications offer a unique form of interaction where regardless of whether or not it is branded, if the experience is fun and meaningful people will use it.
Advertising cannot pay for everything, especially if it's being done in a space where people don't want to be advertised to. There have been a number of posts in recent weeks that basically spell it out that users are willing to be marketed in a social setting if it is an experience that they control.
Social networks in China such as QQ are already turning nice revenues by charging for features, which users would be willing to pay reasonable amounts for it they want them bad enough. Social networks such as MySpace and Facebook should really be charging users very small amounts for the applications and features they install, say 10 cents a piece or perhaps allow developers to set the price of their own applications. This would effectively eliminate all of the stupid applications out there that exist merely for the point of existing and by utilizing their large user bases, could move enough volume to generate some respectable revenue. I know I would pay 10 cents for FunWall because it's extremely entertaining and useful. In addition Facebook could charge application developers a similar small premium for a spot on the Home page since that is where users will typically spend most of their time interacting with their friends. Some social networks already give this away for free though such as MySpace. Despite the perception that people will only use what is free, if you charge them a price that is basically considered free users would simply focus on finding and installing the features and applications that best suit their needs instead of just installing everything. Is that really such a bad idea from the perspective of the user who often finds themselves overwhelmed with application overload which deteriorates the user experience?
I think you're going to see a flood of additional advertising sections posted throughout the site...we're already seeing more ads show up in places like the "Home" page under the user accounts - mixed in with all the updates of your friends/families/groups that are part of your network are sponsor ads.
15 Total
April 18, 2008 at 10:26am by Chase Wegmann
We've seen the future and the future is now! The underlying drive behind any social networks site is to generate profits. Do members/users of sites such as Facebook, MySpace, Friendster, etc...think that individuals and corporate patrons have merely "donated" capital for the end users pure amusement of social networking? Wrong!
These sites have extremely well thought out 5 to 10 year plans which are ultimately geared toward revenue generation either through targeted ads at members based upon freely given information in their profiles and/or activities or through selling of users information to third parties. Many of the members of these site have never taken the time to read through the EULA which govern how their information is to be used.
However, users are waking up. We've already seen the backlash from Facebook's ill-conceived Beacon program which caused a user uprising not seen since the airline/TSA cooperation scandal involving passenger information. Although in the Facebook instance users brought the initiative to a halt unlike TSA's CAPPS II program which is still in place today.
The fact is that people today have adjusted to the reality that their online actions are not private and they willingly trade off a piece of themselves to play the big sandbox that is known as the World Wide Web.
April 18, 2008 at 10:51am by Karen Miller
If it shoves pop-ups, banners and video streamed aliens down our throats, people will go elsewhere to network. If it "targets" users with "more relevant" ads through semantic tools, they will go elsewhere.
April 18, 2008 at 1:04pm by MAURICE KATASZEK
I think a social network group should not directly be a profit mondel. Don't we all have enough of people selling things to eyes.
April 18, 2008 at 3:29pm by Chase Wegmann
I was surprised to find more on this subject today at:
http://blog.wired.com/business/2008/04/how-google-scre.html
April 18, 2008 at 3:29pm by keith cimaglia
I think Jm J Bullock will begin to become more involved in the website - and benefit human society in turn.
April 19, 2008 at 12:36am by Stephen W
Spam. i've already begun to stop using my facebook account as much. It looks to be going the way of myspace, with personal pages, and pages set up for companies and organizations. All it was to me was a way to keep in touch with college and high school friends, now it's trying to be so much more.
April 21, 2008 at 7:26am by Simon Varghese
I think when we talk about a CULTURE it is not that easy for a CHANGE and a change doesnt come so fast.
April 21, 2008 at 5:31pm by
The goal of being profitable is the goal of every company and it's the right thing for Facebook to do. Now culture, I don't believe, has to change because being a successful company was the goal at the beginning and would still be the goal now.
I don't get spammed by Facebook and I've actually clicked on a few ads. The way I would try get profitable would be to see about lowering operating expenses first and streamlining the operations of the backend. Next, I think profitability should become not just the goal of Facebook but they should extend that goal to include the users of Facebook somehow. Lastly, they are on the right course with Pages. Everyone on Facebook is a fan of something or someone and therefore they can leverage their userbase in that regard.
April 23, 2008 at 1:45pm by Nicholas Anderson
Facebook, like MYSPACE, are sites that eventually are going to need to expand their range or they will suffer from upcoming competition. Social Networks are important as a whole, but for the individual - these networks are not important at all. unless there are ways for people to capitalize on these sites - these sites will just be the BBS's of yesterYear!
April 23, 2008 at 3:27pm by Tony Chen
makes me wonder if this can be changed in an evolutionary way at all versus baking the financial model in right from the start (i.e. fast company's article on ning this month)
April 28, 2008 at 4:33pm by Chase Wegmann
And again even more on the social networking, the lack of privacy and the business model:
http://news.wired.com/dynamic/stories/N/NOT_SO_PRIVATE?SITE=WIRE&SECTION...
April 29, 2008 at 4:13pm by Brandon Malone
so wait...why are we changing facebook? isnt it just a tool to keep in touch with ppl and update them on whats going on in our lives? Why are there companies wanting to profit from this? It's not broken, don't fix it.
May 1, 2008 at 5:23pm by Devlin Dunsmore
I really don't know how any of these social networks expect to make money off traditional advertising. Targeted ads based on personal information sounds good, except that people don't come to Facebook to actively look to be marketed to. This is why we see such low CPMs on sites like Facebook and MySpace. The whole branded page idea is bad too since users have to actively look for these pages and groups in order to find them, and as I mentioned that is just not what people come to social networks to do.
In fact these social networks basically give away their best advertising channel for free, applications. There is a reason why branded pages and groups have comparatively low member numbers when compared to the most popular social network applications, and that reason is because applications offer a unique form of interaction where regardless of whether or not it is branded, if the experience is fun and meaningful people will use it.
Advertising cannot pay for everything, especially if it's being done in a space where people don't want to be advertised to. There have been a number of posts in recent weeks that basically spell it out that users are willing to be marketed in a social setting if it is an experience that they control.
Social networks in China such as QQ are already turning nice revenues by charging for features, which users would be willing to pay reasonable amounts for it they want them bad enough. Social networks such as MySpace and Facebook should really be charging users very small amounts for the applications and features they install, say 10 cents a piece or perhaps allow developers to set the price of their own applications. This would effectively eliminate all of the stupid applications out there that exist merely for the point of existing and by utilizing their large user bases, could move enough volume to generate some respectable revenue. I know I would pay 10 cents for FunWall because it's extremely entertaining and useful. In addition Facebook could charge application developers a similar small premium for a spot on the Home page since that is where users will typically spend most of their time interacting with their friends. Some social networks already give this away for free though such as MySpace. Despite the perception that people will only use what is free, if you charge them a price that is basically considered free users would simply focus on finding and installing the features and applications that best suit their needs instead of just installing everything. Is that really such a bad idea from the perspective of the user who often finds themselves overwhelmed with application overload which deteriorates the user experience?
May 6, 2008 at 1:23am by Desmond Haynes
See how Google is NOT able to manage cultural changes: http://techwatch.reviewk.com/2008/04/google-faces-decline-of-entrepreneu...
May 8, 2008 at 8:11pm by
I think you're going to see a flood of additional advertising sections posted throughout the site...we're already seeing more ads show up in places like the "Home" page under the user accounts - mixed in with all the updates of your friends/families/groups that are part of your network are sponsor ads.