People finally realize Facebook intends to make money off of their data
- Image via Wikipedia
There is much discussion about the new privacy changes that Facebook announced this week. Facebook’s changes can be summed up by saying they now offer more granular privacy control by offering per post options as well as an updated default options that share more of your information by default. The Electronic Frontier Foundation’s take is:
These new “privacy” changes are clearly intended to push Facebook users to publicly share even more information than before. Even worse, the changes will actually reduce the amount of control that users have over some of their personal data.
Critics of these new policy changes are basically contending that Facebook is leveraging interpersonal communication for their own profitable gain. Seriously!?! What did people think they were giving up in exchange for world class services at no charge?
This post could be a rant from me about the emergence of spoiled brat behavior from a culture that feels entitled to a free Internet, but that is another post. Instead, I will argue that social media is not a private activity. I will also argue that not paying for the service makes it accessible to more people, which increases the value we get from using the service. And, finally privacy is about personal discretion, not Facebook settings.
Social media is inherently not private
Social media describes the behavioral usage of media. Media is the distribution of content to an audience, which by definition is not private. So, the larger underlying issue here revolves around the use of media as a communication vehicle, particularly for the transmission of private information.
This is of particular interest to us at Webtrends. The largest brands in the world use our technology to measure people’s consumption of online media. Social is an important measurement frontier for our clients, and it’s not just us. Everyone is clamoring to measure the effectiveness of social media as a communication channel for business objectives like marketing, support, HR, etc.
As a result of business interest and monitoring from organizations that range from non-profits to government, we’re at a historic cross road for social media. Are users willing to continue sharing some of their communications publicly as the payment for the communication systems?
The criticism of Facebook’s privacy policy updates suggests that users don’t see their activity as the creation of media. Rather they see themselves using a communication system with implied privacy much like using the phone or email.
The network effect
The value of networks emerge from increasing the amount of connections in them. Trading free service for ads allows more people to connect to our networks, which benefits us. The network effect is explained in Wikipedia as:
Network effects become significant after a certain subscription percentage has been achieved, called critical mass. At the critical mass point, the value obtained from the good or service is greater than or equal to the price paid for the good or service. As the value of the good is determined by the user base, this implies that after a certain number of people have subscribed to the service or purchased the good, additional people will subscribe to the service or purchase the good due to the positive ‘utility:price’ ratio.
If we charge for social networking, we will decrease the number of connections, which decreases the amount of value to the network’s users. The only reason not to enter into an exchange of advertising exposure for service access is a concern about privacy. Rather than destroy the value of the network effect in free services, people can either join private networks or use personal discretion about what they share.
Private networking
While social networking is a public activity, there are private networking options appearing. Privacy is the very principle that Blackbox Republic was created to support. Blackbox Republic is a paid network that was built to be private from the beginning. Their network uses principles like paid accounts, vouching for other people, per post privacy options, and more so that what happens in BBR stays in BBR. And, that’s why users pay for it. And, more services like BBR are starting up to meet the demand for private networking.
Is this the beginning of the end of transparency?
I joined MySpace when there was less than 200,000 users. I remember when they introduced the private profile option. My first reaction was, “What is the point of that? Why be in a public network if you’re not going to share?” I half jokingly told my friends that privacy was for the emotionally insecure. If you don’t feel comfortable with who you are and what you’re doing when the world’s attention is on you, then you’ve got more emotional development to do.
Over time I realized something different. People weren’t, and still are not, using discretion. There are private communication channels currently, so if I have something private to say, I use those channels. To this day, I don’t post anything in a public social space that I wouldn’t feel comfortable with my family seeing or defending myself publicly. In other words, I don’t see the maintenance of my privacy as Facebook’s responsibility. But, I am not the average user.
The lack of models for how to behave online is exactly what I was thinking about when I wrote “Where are our social media elders?” My view is that we need to work through this period of time to determine best practices for the next generations instead of crawling back into the ignorant darkness because we can’t take the heat. One commenter on my post said it well when she wrote:
…there is one real difference that social media has brought to the eons of generational differences in points of view on life: With the entanglement of relationships in the authentic and transparent across generations, for the first time in history we are forced as a whole to engage others generational POV on life to opt into the conversation, whether it’s your mom reading your Facebook, a Director of Public Relations answering outraged youth on Twitter about violations of green space, or the CTO of the United States appealing to technologists to submit answers to decrease the costs of health care.
I hope we’re not seeing the end of sharing a portion of who we are publicly. It would be sad to return to our isolated social bubbles, especially since we’re at a precipice for understanding what aspects should be public and which should be private. The awareness we’re developing from vetting our points of view by being exposed to each other at historic levels is too valuable for our own personal development to turn our backs on. Don’t you think?
Post Your Comment
You must be logged in to post a comment
T/S Members
Log in with your True/Slant account.
[...] This post was mentioned on Twitter by Tweets Tube, Mark Lightfoot. Mark Lightfoot said: RT @trueslant People finally realize Facebook intends to make money off of their data – Ad Slant: webtrends – Enterp… http://bit.ly/6zqyez [...]
A lot of good points here. Most people who use social networks don’t consciously think of their communications as content. On the surface, it’s a status update. Below, it’s valuable data that becomes that much more valuable with continued, concentrated usage. Compounded interest, if you will. And as mobile use increases with geo-targeting and LBS, local mobile social networks (um, lo-mo-so networks?) will become part of the mainstream. It’ll be interesting to see how private networks and groups fare over the next year or two.
That is a good point, Andrea. I’m so steeped in this stuff because I work in the industry that monetization of content as a trade off for free service is as obvious to me as the sky is blue. But, the average user has likely never thought about it.
And, you’re right. Mobile, location based services, and more are heating up the space even further. I’ve heard people talking about the hype around social, and from where I’m sitting we have only seen the tip of the iceberg. Privacy, ownership, behavior, and other ancient principles are being redefined by all of this. It’s like we’re learning all over again what it means to be human and how to behave.
Well said, we are indeed learning all over again the meaning of human. Really cool, free software plus being able to vet our points of view does indeed sound like a good deal–long live network effects! But the psychological costs tend to get ignored. When what has previously been felt to be private gets experienced as “monetizeable” content there will be still unknown changes to individual identity; life will feel different. The growth of social networks requires, I think, a bit more attention to the psychology of those who use them.
In response to another comment. See in context »[...] The controversy has made more people aware that, at its core, Facebook is a business that’s all about helping people share their personal data with others, and hopes to earn money off this exposure-driven activity. [...]
[...] The controversy has made more people aware that, at its core, Facebook is a business that’s all about helping people share their personal data with others, and hopes to earn money off this exposure-driven activity. [...]
[...] The controversy has made more people aware that, at its core, Facebook is a business that’s all about helping people share their personal data with others, and hopes to earn money off this exposure-driven activity. [...]
I’ve been thinking quite a bit about the psychological impacts of interacting on social networking sites. Part of it is about learning to be public people in a connected culture, which was previously the realm of politicians and celebrities (think about image consultants and such). And, part of it is learning to recognize the blurring of lines of marketing messages that are emerging in the social space. I’d like to see philosophical movement addressing these issues. I think, like you, that it would go a long way in the growth of social networks.
Along with “learning to be public people in a connected culture, which was previously the realm of politicians and celebrities” inevitably comes unlearning something about the value of being independent centers of private, subjective experience. It may be worth the trade, but I think the trade needs more attention than it is getting.
There are these classic studies on intrinsic motivation where when you pay a kid (like with marshmallows) to do something they would have done happily and for fun without payment they end up doing it less, not more. Paying someone undermines intrinsic motivation. So, with those findings in mind, I wonder what is happening to the felt quality of social experience when engaging one’s social world changes from something done for it’s own intrinsic value and becomes, instead, something exchanged for goods and services. When you look at the psychology of it, the long-term trajectory of social networking is probably not going to be as linear as it seems.
In response to another comment. See in context »What you are suggesting here reminds me of a TED talk I saw on motivation. In that talk, Dan Pink talks about the way current organizations provide motivation through sticks and carrots, which is motivation derived from payment and fear of punishment. Dan demonstrates how that system works for rudimentary tasks, but fails when trying to solve more complex tasks. Similar to what you’re saying, he contends there are higher values to provide motivation, such as the satisfaction one gets from doing the task (like the children that would do the task without payment).
It seems like there are at least two impacts from monetization of conversation. One is about the impact on users when someone else is profiting from their conversation, which is our current trend. And, one is the impact of personally profiting from your own conversations.
On some level, the monetization of conversations has been going on since the beginning of time, but through many layers of abstraction. That is where we get the colloquialism “word of mouth advertising”. But, as the ties between conversation and value exchange approach each other, we become more explicitly aware of our participation in the process, which makes us more conscious of why we’re doing what we are doing. That means we now need a set of beliefs to govern our actions through the process, which requires some introspection if not a more formal approach to studying the quandary.
Man, this is some good conversation! I’m enjoying it
In response to another comment. See in context »Good (and enjoyable!) conversation indeed. Thanks for the TED link to Pink.
In response to another comment. See in context »Thanks, Justin.
All of this about (the lack of) privacy and how it’s our, rather than social networks’, responsibility is very well-put.
One clarification:
You did state “implied privacy;” it’s important to note that it’s less and less advised to expect any true privacy when using the phone, and certainly when using email. Communications via both means are traveling more and more over public networks and servers. This leaves them open to more opportunities of snooping, governmental requests, etc.
This lack of privacy is not exactly the same as we’re discussing with Fb, but it’s important to note even “private” modes of communication are not-very private and discretion is still advisable: if calling or shooting an email to Aunt Sadie shouldn’t be considered entirely private, considering what you post to a public social network seems appropriate.
Steve, that’s a good observation. I’m sensitive to anything I’d put down in writing as it has the ability to come back and haunt me. For example, I don’t gossip about coworkers on email because I assume it could find its way back to HR. There is something to be said for the impermanence of face to face conversation that should be reserved for communications we truly wish to keep private.
It all comes back to why we want to keep things private. Sometimes it’s about competitive advantage, in which case secure phone lines and email could be sufficient. Sometimes it’s about matters of our personal lives, in which case we’d want to think about committing any of that content to a communication system. It would be interesting to pontificate on what we want to keep private and why in order to arrive at best practices.
[...] between the expectations users have toward media and communication. To clear up this confusion (again), we pay for private [...]