Not wholly for the smooth caress
Analysts and observers who are content with cliches characterize Facebook as sitting on a treasure trove of potentially valuable data about its users, which is true enough. The cliched view is that what’s valuable about that data is names associated with locations associated with jobs associated with social networks, in a very granular way. That’s not it. That data can be mined easily from a variety of sources and has been mined relentlessly for years, before social media was even an idea. If an advertiser or company or candidate wants to find “professors who live in the 19081 area code who vote Democratic and shop at Trader Joe’s in Media” they can buy that information from many vendors. If that were all Facebook was holding, it wouldn’t have any distinctive wares, even imagined, to hock. All it could do is offer them at a bargain rate. […]
What Facebook is holding is a type of largely unique data that is the collaborative product of its users and its interface. […]
So what of the other unique information Facebook holds, a record of everything I’ve “liked”? Surely that’s information worth having (and thus worth paying Facebook for) for anyone desperate to sell me products, persuade me to join a cause, or motivate me to make a donation? Not really (or not much), for two reasons. First, because existing sources of social and demographic data are generally good enough to target potential customers. If you know who the registered Democrats with graduate-level education making more than $75,000 a year are in Delaware County Pennsylvania, you have a very good understanding of their likely buying habits and of the causes to which they are likely to donate. If you’re selling something that has a much more granular target market, it’s almost certainly more efficient and cheaper to use a more traditional media strategy or to rely on social networks to sell it for you simply because they’re interested in it. If you’re the budget-photography company YongNuo, you don’t need spend money to mine my Facebook likes and posts to see I’m interested in moving into studio-based strobist photography: existing networks of hobbyists and professionals are sufficient to acquaint me with your products. If you’re trying to sell a Minecraft pendant necklace, your potential customers are going to do a fine job of notifying each other about your product. […]
Social media that have no business model except trying to monetize the information that users provide to them will, sooner or later, be required to breach trust and demolish whatever is useful in their service, to come back again and again with new interfaces and terms of service that lie or conceal or divert.
