Wednesday, January 29, 2014

The Problem With Facebook

Facebook is a complex ecosystem of individuals, creators, brands and
advertisers, but I don't think it serves any of these groups
particularly well because its top priority is to make money. Now, I
don't think making money is a bad thing, in fact I hope to make some
myself. The problem is the only way Facebook has found to make money is
by treating all entities on the site as advertisers and charging them to
share their content.

This business plan backfires because 1) not
all entities ARE advertisers and 2) it was the content from these
people, specifically friends, family, and creators that made the site
worth visiting in the first place. Now the incentives are misaligned:
individuals want to see great content, but they are now seeing more
paid content and organically shared content which appeals to the lowest
common denominator (babies, weddings, and banal memes)
- creators want to reach fans but their posts are being throttled to force them to pay to be seen
brands and advertisers have to pay once to advertise their page on
Facebook, and then pay again to reach the people who have already liked
their page. Plus Facebook is not a place where people generally go to
buy things.

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