Category: Social Networks

83: The Fall of Facebook

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Back in 2006, I loved Facebook. I loved connecting with people and friends from around the world. The updates were great to see. The world needed it. I was convinced that social networking was the killer-app for the internet, and I still think that was true.

But then the world matured. By now we’ve all gotten used to it. The novelty has worn off. We take that online social connection for granted.

In today’s world, it’s not just enough to connect people and share the information, you need to provide context around that connection and that information. This is how people get news and information.

I’m not the only one who thinks so. When Trump posted last week “when the looting starts, the shooting starts.” the employees at Facebook wanted to label that post as offensive, but Zuckerberg was adamant that all posts go up without being altered. Hundreds of employees are pissed after the company took no action.

Mark also went on Fox News and criticized Twitter for fact-checking Trump’s posts on mail-in ballots. He said he didn’t want his company to be an “arbiter of truth” on political issues. I think he’s the only one who feels that way.

Come on Mark. Let’s be honest, the reason you care so much is because (a) you don’t want to sign up to do the work. It’s a lot to label posts as incorrect or violent and once you set the precedent that you can’t go back, (b) the alt-right and other groups (Russia) are paying customers and it hurts the business to take sides, and finally (c) when your core product is harmful, you wants few warning labels as possible.

For all of these reasons, my views are switching. I’ve always viewed Facebook and its ability to connect others as a net positive in the world, even with all its flaws. But considering the recent actions and lack of conscience I hear from Mark, I’ve come to think of them as a net negative.

With over a billion monthly users, I only hope it turns around and gets better as they have enormous influence and power in the world.

Continue reading “83: The Fall of Facebook” →

Business Week Zoom

Day 27: Zooming All Over

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Zoom is the accidental social network of the coronavirus pandemic

What I’m Thinking About: Zoom

This has been an incredible rise and a little bit of a fall for Zoom.

In the past month, they went from 10 million daily users to 200 million. Wowza. In the past week 90,000 schools across 20 countries have used it to conduct remote classes. Ninety thousand schools.

They also revealed that while they’ve been focused on keeping up with growth, they’ve done some not great things. Specifically, they were sending info to Facebook even if you didn’t log in or ever use Facebook. Second, the videos/calls aren’t really encrypted, which means others can see and hear what went on. Oh, and third, many of the videos and encryption keys were routed through China so they were available for the Chinese state to hear and view. Hmm. 🤔

Personally, I don’t care if my personal or work calls are viewed in China but I suspect a lot of more important people and companies do. This could be real bad for them and for Zoom. I’m curious to see what the fallout is.

I’m also curious to see how Zoom integrates itself more into my life. I’ve been doing double-dates with friends, group family chats, happy hours, school lessons and more. It’s a daily app now.

Finally, I usually really dislike recorded Zoom calls, but here’s one I couldn’t stop watching. It’s ESPN reporters inviting famous people to join them.

 

What Else: The Flattening?

Nationally, the number of coronavirus deaths in the U.S. is projected to hit its peak within the next few days. Personally, I’ve been hoping that this is the worst as we had a few days of no growth, but yesterday we had peaks in new cases and deaths in the US and many others charts are saying that we still have some more time to go. 😞

 

Other Stuff

Great ad:

 

Cases

From my spreadsheet:

Have a great Saturday everyone:

Only 64 more days to go

 

Tinder’s Right Swipe

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As a product person, sometimes you prioritize incremental improvements instead of game-changing ideas because “the big swings” take too long.  This almost happened at Tinder and the “swipe right” almost didn’t exist.

Here’s an article in Wired where the CEO and CTO recount how they talked about it.  Jon Badeen (The Chief Strategy Officer) came up with the idea after seeing it done in flash cards in Chegg.  He then showed the rest of the team.

Sean Rad (CEO): We had a five-minute conversation.  It was a cool idea, bt jon thought it would take two weeks to build.  So I said, eh, probably not a priority.  That was right after we launched.  We had a whole set of wings we wanted to do
Ryan Olge (CTO) chimes win with: We wanted to do read receipts, typing notifications, all these things

Then all of the sudden it showed up in the app.  Apparently Jon worked on it over the weekend because he really wanted it.

And now the world has the right and left swipe.



The “Better-Nevers” of Technology

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I was thinking about my life and the web the other day and talking to some friends over lunch about how I love that i’m married to a woman who enjoys the web and has intellectual curiosity about it. I was then approached by a woman in a restaurant who was eavesdropping on my conversation. She called me over and then went on for 10 minutes telling me how my love of technology is what’s making the world so horrible. How my blind devotion to electricity is polluting the lakes and ruining the planet. I’ll spare you the “conversation” but let’s just say, i left wishing she hadn’t felt a need to share and that my friends were quicker to pull me away.

So, for her and her hatred of technology, I’d like to share a quote i just read:

“When department stores had Christmas window with clockwork puppets, the world was going to pieces; when the city streets were filled with horse-drawn carriages running by bright-colored posters, you could no longer tell the real from the simulated; when people were listening to shellac 78’s and looking at color newspaper supplements, the world had become a kaleidoscope of disassociated imagery; and when the broadcast air was filled with droning black-and-white images of men in suits reading news, all of life had become indistinguishable from your fantasies of it. It was Marx, not Steve Jobs, who said that the character of modern life is that everything falls apart”

History repeats itself. The world is changing and that change frightens people and computers are thus responsible for the problems. This isn’t the case. It’s not the web making the world a worse place. Relax people.

Continue reading “The “Better-Nevers” of Technology” →

The Social Network Movie

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I saw the new film The Social Network this weekend and loved it.  This was an interesting film for me.  It was the first film where i knew or met many of the major characters.

  • I’ve spent a good deal of time with Sean Parker.  We’ve worked together (briefly at AOL).  We’ve partied together when we both spent a week crashing at Spencer’s place in Hermosa. We’ve collaborated on a company together- my dad and I angel invested in Plaxo
  • I’ve met with the Winklevoss twins.   They came down to look at Ruckus in 2006 when they were still doing ConnectU
  • Others i’ve only met once or seen indirectly, such as Dustin and Peter Thiel.

But, it’s safe to say that i know the cast of characters which made the film incredibly satisfying.   Fincher and Sorkin nailed it as the characters in real life are very much how they are depicted.

The fact that this is a good movie can be attributed directly to Fincher and Sorkin.  The writing and directing is phenomenal.  Fincher takes his modern, slick style with awesome music and combines it with smart, quick dialogue.  You’re forced to keep up.  The result is great storytelling.  A mediocre plot become fascinating because of them.

The interesting parts to me are:

The ethical scale. In the web industry, there’s a huge hacker culture where technology grit and talent is valued over rules.  There are no rules.  Zuckerberg completely embraces this and the Winklevoss twins are on the other end of the spectrum.  Every other character is somewhere in the middle of this scale.   I see this every day when i see and talk to programmers who are trying to do something unique and innovative.  This is how Napster came to be.  This is how Skype happened.  It’s part of the web culture and i thought the film did a good job of showing the two types of people converging into the web business.

Sean Parker. He’s quite a character and I’ve had the pleasure of hanging with him a few times.  He is just as the movie describes as he’s very charismatic and love parties, high fashion, models and going to trendy spots.  But the film doesn’t do him justice in a couple of areas.  First, he’s a social software genius. He understands better than others how to make a site social and gain millions of users.  The movie makes him look like he totally mooched off Facebook.  It should be noted that he’s responsible for some huge contributions such as the News Feed.   In addition to the Peter Thiel money, he also helped with the Accel $10 million investment.  These are huge things.

There’s also a class system matrix here. You have old money (Eduardo and Winklevoss), you have no money (Zuckerberg) and you have new money (Sean Parker and Peter Thiel).    You have a kid with a chip on his shoulder making something extremely valuable.  Those with old money and traditional business models in their head (Eduardo and The Twins) want it and want to fit this round peg into their square hole.  The new money characters (Parker and Theil) know the true potential of Facebook, what it can accomplish, and that growing it now is the better strategy.  This was a very real dynamic and in fact i wrote about it 18 months ago when everyone in the media was writing about how Facebook pageviews are worthless and how they won’t be able to monetize and the social network business as we know it isn’t nearly as valuable as we thought.  It was all crap and it was because this is new unchartered waters.

The product is king. In the consumer internet business, the product on the page is the single most important thing.  Making the user experience tight, fast, and easy is the difference between a successful site and one that nobody uses.   This is why you can have two websites that do the exact same thing but one is a huge success and the other goes out of business (see the example between Mint and Wesebe).  This is especially true with social networks where it’s a winner take all game.  Network effects cause there to be one big site and lots of losers.  Zuckerberg knows this.  He intuitively understands the user experience.  Facebook is a great experience.  This is also why he discounts The Twins and their ambition.  Just having an idea is only a small part of making a site and a business.  He knows this, I know it and The Twins probably know this.

History of social networks and Exclusivity. For the casual viewer, i think the film might seem like Zuckerberg invented the modern day social network.  This just isn’t true.  Before Facebook there was Friendster, MySpace and half a dozen other social networks that had profiles and friend linkage.  Facebook’s defining characteristic was it’s default privacy settings – it’s exclusivity.  There’s an important scene in the film when Zuckerberg realizes that this is the idea behind the Harvard Connection and this idea makes social networks fun and more realistic.  This exclusivity was Facebook’s major point of distinction for the first few years of its existence and it’s interesting that this one point was not his idea.  Granted, he may have a better product sense than others and built a great site, but it was all founded on shady ground.  Putting in the work and developing the actual product is 99% of a web business, but if the main difference between Facebook and every other social network is not something you came up with, then that’s a problem.  And apparently that problem equals $65 million dollars.  Seems like more than a fair trade

Startup Culture. I thought the film did a great job of displaying web and startup culture.  Sure, it’s a group of people who don’t sleep but more importantly it’s a group of people who believe what they’re doing is the single most important thing on the planet.  They dream of kingdoms and a world domination.  Every feature they implement is a step in that direction which is why it’s ok to sacrifice social lives, money and sleep.  You saw that allure in this film.  That house in Palo Alto reminded me of the Fincher’s Fight Club house where another, different kind of cult was brewing only the one about Facebook was and is real.  It happens every day in the valley and across the world with startups.

All in all, I thought it was a great film and found myself thinking and talking about it for days afterwards.  You should check it out.

Facebook’s Fundamental Problem

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I read a great post that opened my eyes to something interesting going on about Facebook’s privacy issue.   The issue has to do with how they position themselves in regard to being either a communications platform or a content platform – and how this impacts how they treat privacy.  If you look at this chart:

You see there are two sections: Communication and Content.  Both are directions that a company can focus on.  What’s interesting is the relationship between virality and revenue potential.   The more focused an application is on Communication, the easier and more quickly it spreads – but it can’t easily sell ads or monetize.  The more Content-centric an application is, the easier it is to monetize (ads are more relevant with higher CTR) but it’s hard to get the app to spread and grow.

Facebook started, of course, as a closed network for college students where they could “connect” and communicate.  As the statement above would suggest, this caused it to spread very quickly.  And it did.  However the site wasn’t making much  money.  Now, they find themselves with a slew (if you can call 500 million people that) of users and a desire to monetize.  It then makes sense for it to move up the scale and become more of a content company.  Thus, you see lots of Like buttons all over the place, a payment platform, and an ad platform to make this as effective as possible

The problem is with privacy.  Users were led to Facebook thinking it was on the Communication side of the fence.  However, it’s ambition is to be more in the middle because that is where it can both spread quickly and make money.  The privacy rules of a Communication web application and Facebook now are longer in agreement .  You can’t ask people to “Friend” and communicate with work people, parents, and close personal acquaintances and then also ask them to make that information public as if it is Content.  That there is a fundamental problem.

Fred’s 10 Golden Web-App Rules

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This past weekend i watched this video from Fred Wilson about what are the 10 Golden Principles of a Web application. Fred has been an investor for over 20 years and is on the board of some of this decade’s premier companies such as Twitter, FourSquare, Tumblr, Etsy, Delicous, and more.

The 10 Golden Principles of Successful Web Apps from Carsonified on Vimeo.

  1. Speed.  Fred sees speed more than a feature. Speed is the most important feature and he argues that this is more important with mainstream users an early-adopters who are more forgiving.  Everyday users have no tolerance for slugish apps.  I heard the same thing from Google when they presented at Techstars.  They measure everything and if it’s slow, they fix it.  Fred mentioned pingom as something they use to measure every portfolio company.
  2. Instant Utility.  If a user has to spend too long to configure the service – it won’t catch on.  YouTube is a great example of how it won by providing instant feedback rather than delaying the gratification.
  3. Voice.  Consumer software is media today.  Consumers approach in the same way the approach magazines, tv shows, etc.. Software has to have a personality and if it has no attitude, then it won’t catch on.
  4. Simplicity.  Just one main feature at launch.  Fred points to Delicious as a perfect example of this.  Make the app super simple and then go from there.  There are lots of good posts on how to focus on this.
  5. Programmability.   Make your app accessible from other developers.  This means read+write API’s and if’s not “write” it’s not an API and might as well be RSS.   Allow other developers to add energy, data and richness.  In Fred’s mind this is absolutely essential and he’s hesitant to invest in anything that isn’t programmable.
  6. Personalizable.  You want make your app infused with your user’s energy.
  7. REST URLs.  Make your app easy to navigate – give everything a URL. This also makes is discoverable from Google.
  8. Discoverable.  There are millions of web pages and web applications.   This point means SEO but it also means that your app itself should be self-promoting.  This means social media and branding.
  9. Clean.  This is UI requirement.  You need to be able to come to the page and be able to immediately determine what to do and what’s going on.   It has to be inviting and simple.
  10. Playful.  An app should be fun to use and it’s use should encourage future use.  Weigh Watchers is a good example as it establishes points and goals and getting the points and acheiving goals is something that should be embedded in each application

There one more interesting point he spits out at the end about the name and brand of a company.  He talks about how important it is to him that the company purchases the actual name of the company.  For example, Foursquare was playfoursquare.com and they insisted that they change.  He also insisted that del.icio.us become delicious.com.

The 10 principles are interesting to think about and a good checklist for any startup to have.  I’ve definitely been guilty of ignoring some of these in my past work.   Interesting stuff

I Do Not Agree with the Hog Pile on Facebook

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There’s a growing trend in the media to attack facebook.  It started when their redesign got pretty bad reviews, continued when their CFO left, and now is gaining steam as mainstream outlets are questioning it’s core business proposition. There are three different things here and the media is pointing to them as an indication of Facebook‘s failure.  I disagree.  Here’s why:

Product enhancements. One thing i’ve admired about Facebook is their ability to keep pushing their product forward.  They introduced a great photo experience before any of their competitors (and have grown to be #1 on the web).  Even as they were experience phenomenal growth (they hit 8 million student readers), they completely redid their home page when they introduced the News Feed.  While initially hated by their users (FB blog) and the media (Time article), it set the standard for how social networks should display user activity and is now seen as a stroke of genius.  And growth climbed even higher.  At 70 million users they then completely redid the profile page to be a feed-based page as this is the best way for users to continuously portray themselves (see Tumblr for an example).  This was hated at first too.  Now, they redone the Facebook Home page to better showcase conversations and user activity.  Is it like Twitter? Yes.  Is it hated by their users? Yes. But it is also an improvement.  More than any other company i know of, Facebook is constantly pushing to get better in all areas and doing it fearlessly.  Even if they misstep, I applaud them for it.  From my experience at AOL i’ve seen that when yoy have a large user base it’s very easy to become tentative and second-guess every move.  Not changing becomes the easiest path.  It also means you start dying.   This latest change is more an indication that they’re not dying but moving forward.

Valuation.  Facebook got an absurd $15 billion valuation from Microsoft when it sold them some equity.  That deal was more than just equity sales but it also solidified Microsoft’s relationship with them as their exclusive third-party ad provider (story).  That valuation has become a problem as every new raise that happens in the industry (Twitter,  FriendFeed) is evaluated against it.  Facebook is now raising at a more reasonable level at a $5 billion valuation.  I don’t think this is an indication of failure of FB but rather a reflection (a) that these raises are straight equity and not part of an ad sales agreement, and (b) the market is the worst it’s ever been.  I think it’s ridiculous to think that the environment is the same as it was in October 2007.

Business Model. The media talks about Facebook’s failure to make an ad business out of their inventory.   Time’s article this past week was called, “Facebook Takes a Dive: Why Social Networks Are Bad Businesses.” This is completely ridiculous.  First of all, MySpace is making money.  Let me repeat. MySpace is making money.  They were bought by Fox for $580 million and they then immediately did a deal with Google to sell ads on their search page from 2006 to 2010 for $900 million dollars (details here).  That’s a quick profit of $320 million.  Everything else on top of that year-in and year-out seems to be gravy.  The article in Time continues to say:

What is true is that social network sites have had trouble making money. MySpace was supposed to be a big part of the revenue growth at News Corp. Wall St. thought Murdoch was a genius to buy it. Last year, News Corp had to admit that MySpace would not hit its revenue targets. That is usually not the hallmark of a property that is going to take over the Internet.  Analysts believe that MySpace rival Facebook had revenue of $265 million last year. That is astonishingly low for a company that had 57 million unique visitors in the U.S. last month. And, Facebook also has a very large international user base.

So let me get this straight, even though MySpace is profitable at $500-800 million dollars a year in revenues and even though it’s generated hundreds of millions of dollars for News Corp it’s a bad business becuase they missed their revenue target last year?  That is completely ridiculous. Facebook is a differnt issue.  They have repeatedly said that they are deprioritizing ad revenue and instead focusing on growth and user engagement. Since they started saying this (starting in late 2007), they have grown from 50 to 200 million users.  I’d say that’s pretty good execution. Facebook makes about $275 million a year.  Could they make another 100-200 million if they started selling more ads on search pages and profile pages?  Absolutely.

All of these reasons above are why sensationalist articles discussing the demise of the social network drive me nuts.   Nobody knows what the future holds, but one thing that we can pretty much be sure of is that sites that have great user engagement and activity – and facebook has over 20 million users update their status at least once a day – will get the ad dollars.  Nick O’Neil has a good post on AllFacebook today on why he’s willing to pay a $34 CPM on facebook.  It’s not the silver bullet but it shows that there is a profitable end in sight for the company and it’s not necessarily the horrible business the media would like it to be.

Google Latitude

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Image representing Google as depicted in Crunc...

A new feature was released today from Google called Google Latitude.  It’s allows you to post your location onto Google Maps and to see your friends’ locations.  It’s done using GPS and other technologies (Gears, etc.) and works really well.  Here are some thoughts i have on it

First, I like the way it looks and works. The interface is extremely simple.  Entering in info is done inline and the interface is definitely not cluttered with too many bells and whistles.  Adding and viewing friends is also braindead simple.  Overall, it’s a snap to use

It’s a social app but it’s different than a social network. For instance it’s (a) only really useful for people you know, (b) more interesting for people you live close to, and (c) limited to only location information. It’s only a map.  Again, very simple

google-lat

Not everything is great though. One thing i don’t understand is why they force you to access it (on the web) through iGoogle.  I have a homepage already and see no other reason to go to iGoogle.  That’s annoying and i wish it had it’s own site like Google’s Calendar, Reader, Maps, Mail, etc.  Also, I also wish it would use my profile from other Google products. It seems now that i have a different profile for Gmail, Calendar, Orkut, FriendConnect and Reader.  Why can’t there be just one?

Since i’ve had a iPhone, i’ve become much more aware of the usefulness of my location.  When this information is layered onto web services, those services can become much more useful.  I like this new app because it shows that there’s a whole other layer (location) that is just starting to be explored. I can imagine many applications starting to layer in location and serve information based on this.  Ad targeting, ticketing, messaging, groups all change when this is added.

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