This is along the lines of Alok’s post but different enough that I thought I would do a new post.
When I look back in history for a model that may predict how the broad social networks will evolve, the Television industry comes to mind. Facebook would be Comcast and there will emerge channels like HBO, PBS, NBC etc. Slide and Rockyou are trying to be these on Facebook. And then there will be the shows that these channels have, some produced internally and others acquired. They will all make money off advertising, market research, virtual goods and ecommerce.
The big difference will be in value of all this. Attention is moving. This all could be many many time more valuable as this is a 2-way medium and the dream of interactive entertainment on a global scale is being realized (interactive tv never took off).
Am I on drugs? What does this blog think?
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Sunil –
Its likely, but immensely futuristic. I don’t think any FB user perceives it that way, although FB might nurse hopes of becoming a Comcast some day. The real problem here is that all social networks are merely that – “social networks”. To engage them in advertising is likely impossible, because its completely contrary to “permission marketing”.
Market research and commerce are likely decent monetization models, but for anyone who’s tried doing any king of market research on FB knows how much to trust stupid teenagers.
Cable operators and broadcast channels ensure quality, which is good enough for consumers to endure the ad-nuisance. FB cannot ensure that, unless it decides to police way more than it does, and consumers just wouldn’t pay for crap.
Sunil
I think the big difference is that cable controls access to channels, in a physical sense (either through a box, or even a cable) that is hard to replicate on facebook. It is that physical lockin that allows cable companies to draw annuity revenues and command high profits. They also own the billing relationship, which facebook doesnt (and hasnt shown an intent so far to do so).
There is value in being the “relationships infrastructure” for the internet. However, facebook will need to open up tremendously to get there. As I see it currently, other large networks, such as myspace, orkut, yahoo are all opening APIs and are going to have the same application as facebook. Perhaps eventually, all of us should own our relationships’ information, and expose it to appropriate parties…
Largely true but with one BIG difference. the Slides and ROckyou’s of today
can also survive on their own unlike HBO that needs a broadcasting channel.
Granted, piggybacking on the likes of FB is MUCH easier with a readymade userbase, etc.
What is more relevant is whether the Slides depend on the userbase or not.
Say for e.g scrabble (on FB) is not dependent on the userbase metadata.
Also, say myspace opens up, then they may want to offer $$$ to take Slide away from FB. Then the game gets more interesting.