Thoughts on Facebook
Mark Zuckerberg’s mea culpa yesterday triggered a veritable tsunami of commentary on Facebook’s decision to atone for its sins by making its new Beacon advertising system less intrusive. The apology came too late to avert a medium-sized PR disaster, though I dare say there’s still plenty of life in them yet. And since the mere fact of piggybacking on a titular snowclone employed by the likes of Jobs and Zuckerberg makes me feel a teeny bit more important, I’ll chime in with a couple of thoughts of my own.
Now everyone knows that Facebook wants to be Google. Heck, everyone wants to be Google, but they’re the most plausible (or least implausible) contender right now. And that implies not just a great website and a lot of users but also an innovative, lucrative and scalable source of revenues. I can almost see their management team sitting down and brainstorming about the goose that would quack and waddle them forward in their quest for inevitable world domination amidst a pounding hailstorm of golden eggs. And what did they come up with? Advertising. Now where have I heard that before?
There are more than a few problems with this beyond the ham-handed way they handled Beacon’s rollout. As Tim O’Reilly points out, there isn’t enough ad money out there to finance the wholesale shift of media online. Facebook doesn’t share anything obvious with eBooks beyond the last five letters of its name, but I think the basic principle stills stands. Google has managed to go on minting ever greater sums to a large degree because its search engine drives such tremendous volumes of traffic. And that traffic is by nature intentional, as Alex Iskold rightly notes. I click on their ads because they might help me find that specific something I’m looking for.
Alex might be a bit harsh in condemning the whole notion of contextual advertising based on a flawed but ambitious product that is still only a few days old. But at the end of the day the whole idea that Facebook will justify its vaunted $15 billion valuation by pioneering the new new thing in targeted ads strikes me as unrealistic and facile. If I were them I would instead extend their application platform (which is truly innovative) to support paid services, taking a cut of partners’ revenues. I’m sure there are plenty of web developers out there who would love to take on eBay, Monster, iTunes and Match.com by leveraging Facebook’s gold mine of social features. Many would fail, of course, but who cares when the mother ship would book a percentage of whatever winning ideas an infinite number of monkeys scrappy startups can come up with?
On another note, did anyone else notice that Zuckerberg’s epistle of self-flagellation doesn’t mention the word advertising even once? Perhaps this is just another example of corporate spinmeistering at work, but I think there’s more to it than that. Ever since Jason Kottke’s seminal piece comparing Facebook to 1990’s AOL, freedom-loving folks (you know, the kind who wear sandals to business meetings and think they can hear the difference between FLAC and MP3) have lamented the rise of another online walled garden. How better for Facebook to counter this than to find a way to integrate their core functionality into the fabric of the web? The clever way that Beacon lurks in the background as you surf on other sites is an intriguing suggestion of the course they might take to make this happen.
And who knows, maybe they’ll actually pull it off and make their platform a crucial part of future web DNA. But it seems like a pretty big ask. Personally I hope that we’ll gain open standards for online identity, social graphs, information feeds and other goodies that will make the very notion of a social networking website obsolete. I’ve long argued that browser vendors are the best placed to make this happen, and perhaps we’ll even play a small role in this ourselves. Mozilla, in particular, has been impressively forward-looking in this regard, with ideas like The Coop brewing in its labs. (And I would be remiss if I didn’t mention that Flock got the ball rolling on this before most people even realized that there was a ball.) Chris Beard, who is the head of Mozilla Labs, laid out more of their strategy in this area the other day in a post that reads suspiciously like a shot across you-know-who’s bow. It’s a bit early to call a winner, but as the battle heats up, things are starting to get interesting.
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Hey, Matt. When are we gonna get an AllPeers application for Facebook? I think it’s a good idea.
Comment by Ben — 12/7/2007 @ 9:04 am
Hey Ben,
Yeah, we like this idea too but we think there are some additional features (Share-n-Browse, Always On) that we need to implement first for it to make sense.
Comment by Matt — 12/7/2007 @ 12:11 pm
Hi Matt,
Really good post. Thanks for link love.
Alex
Comment by Alex Iskold — 12/8/2007 @ 5:06 am
And today’s Facebook Gift? The goose that lays the golden egg!
Comment by Lionel — 12/8/2007 @ 1:32 pm
When you do decide to roll out a facebook app, let me know I would love to help! I have the experience from building three successful facebook apps, one with almost 300,000 users.
Comment by 20after4 — 1/2/2008 @ 3:43 pm