The Biggest Issue Facing Facebook Today

March 14, 2015 - Just For Kicks

In the face of declining advertising revenue, investors are questioning the continued value of Facebook.  More importantly, users are questioning the value of their time in an environment replete with ads, spam, and fraudulent identities.  These are natural concerns.  When a person can create a spam email account and then within the matter of a few days have hundreds or even thousands of friends and followers simply for the purpose of generating backlinks or traffic to a website, there is no question about the declining value of Facebook.


So, what then are the executives to do?  Continue to fight the spam?  Develop new tools to identify and remove fraudulent accounts?  Rework their advertising platform in order to provide better value to their customers (the advertisers)?  All of these are excellent ideas, and what is more, Facebook is already attempting to implement these ideas – at the cost of many millions of dollars each month.  In fact, these are the exact same concepts that Facebook and every single other social networking site has been working on for two decades – all to limited success.


Why?  The answer is simple really.  Every social media company in existence or that has existed faces millions of independent individuals and groups dedicated to exploiting the loopholes in their system in order to gain as much free exposure as possible.  Fundamentally there is no way any company can keep up.  A company founded on the principal of convincing others to create value for them for free and then reselling that value to other companies only interested in stealing as much of that value of possible will inevitably fail.


The premise that Facebook operates under is that people want to communicate with each other and they are willing to put up with advertising, spam and fraudulent users in order to do so.  Fundametally there is little difference between what Facebook does and what any mass email service does, with the exception that email is more secure and has less spam.


The value that Facebook creates (or used to create) for its users is a simple, easy, and effective way to communicate with others.  On the surface this seems like a great deal, but once the novelty wears off, where is the value really?  Forms of communication  fall into a few categories, but the most simplistic are two – personal and business.


For personal communication needs individuals have automatic buy-in – that is to say that there is no need to advertise, bribe, or influence people to use the service.  Think of the telephone.  Do you need some outside incentive to call your mother or wish your friend a happy birthday?  Personal communication is something we just do, and when we do it we do not expect any sort of outside, uninvited parties to intervene.  Imagine if when you called your friend on his or her birthday you had to listen to a ten second ad first.  How long would you use the service?  Not long.


Business communications, on the other hand, although at times are spontaneous, generally have an element of persuasion involved.  These types of communications can take place in many forms, from that annoying telemarketer calling during dinner to the iconic company logos that you don’t even have to think about to recognize.  The expectation of influence is inherent in the deal, and many of these influences we now accept without question.  When we watch television or read the newspaper, for example, we understand inherently that advertising will come along.


The problem with social media is that it attempts to mingle the two, and this is inherently dangerous because the business runs the risk of offending its users.  These people – people just like you and me, really have no desire to create content/value for a company and then give it away to them for free so they can resell it.  In essence this is exactly the business model that Facebook (and many defunct companies from the past) tries to follow.  The model works up to the point when the network becomes over encumbered by third parties and the users begin to feel uncomfortable mingling their personal and business communications.


Inevitably the system breaks down as users shift back to other means of facilitating personal communications and filtering out the business interests.  This cycle has been repeated over and over again over the last twenty years by numerous internet companies.


What is the solution?  The solution is the same simple solution that every other media form for centuries has been using – create valuable content.  Newspapers, magazines, radio stations, theatres, television, and every other form of media continue to thrive only so long as the content they create is valuable.  For these same reasons these forms of media have endured for decades.  Until Facebook begins to create its own valuable content it serves the same function as a television set.  In and of itself a television set is nothing more than a collection of metal, glass, and plastic – completely useless without interesting content.  Likewise Facebook is nothing more than a machine to facilitate communication.


Until major media producers produce valuable content to send over their network – and advertising is absolutely NOT valuable content – Facebook has no certain future.  For the present major media producers continue to use conventional outlets to send out their products – movies, music, television series, sporting events and so forth, and without these types of major media events the value to the end user is extremely limited and will continue to decline week by week,.


Until Facebook is as secure and simple as turning on a radio or television set it will have no more intrinsic value than any other media device and will quickly follow the same path that VCRs, the telegraph, and every other archaic media device has followed.

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