23 Musings

Part of Facebooks game plan seems to have been to create an illusion of openness while at the same time ensuring that their platform is actually closed to anyone who could tread on their toes in the areas that drive their revenue. Now admittedly they don't have much revenue right now but that is going to change very soon with all the new advertising options available to brands who want to be promoted on the social network. So with this increasing revenue should come an increasingly closed approach as they try to prevent others from stepping on their toes. Right?

Well, it seems Google may have a way in to the Facebook platform, and it may be something that Facebook can't do anything about.

Bring forth OpenSocket; a Facebook application that allows you to run any OpenSocial application on your Facebook profile. Now, as OpenSocial gains traction I can very well see developers looking for ways to monetise their efforts on this new platform. Of course, with Google at the helm one of the obvious options would be to carry Adsense adverts on your OpenSocial app. So that is how Google can potentially make advertising revenue out of Facebook without striking any sort of deal.

Will this happen? Well, I'd imagine Facebook will try to block Google ads from appearing, but if a lot of developers start using OpenSocial the demand to allow this may be overwhelming and actually more in Facebooks interest to allow this than to try to block it.

For development... Don't get too excited as this doesn't guarantee them dominance in the social networking world but Google have a bit of a coup as they've announced MySpace, Bebo and Six Apart are going to be working on Open Social too. Apparently Google have been in talks with MySpace for about a year on this (which explains the recent appetite to open up from MySpace). Techcrunch has more here.

Here's the official announcement from Google on their blog, and here's the link to the API's which is now live.

And for an insight into why this is all happening, here's a video from a Google event last night explaining more about why it's good to be open.

The full list of Open Social members is pretty formidable (MySpace, Engage.com, Friendster, hi5, Hyves, imeem, LinkedIn, Ning, Oracle, orkut, Plaxo, Salesforce.com, Six Apart, Tianji, Viadeo, Bebo and XING). Should Facebook be worrying? Well right now all the announcements mean is that there will be an amazing amount of openness between the members of Open Social and there should be some pretty amazing development going on. It doesn't yet mean that people will leave Facebook for anywhere else (although the chances of that will get greater).

There may be an opportunity here for an early adopter of Open Social standards to create an uber social network which features functionality and data from all the participating networks. It makes the evolution of the life stream much more important and likely to appear sooner. It also gives choice, no longer do you have to stick with anyones interface, you should be able to move away and go to other places while still keeping in touch with the networks.

Techcrunch has a great article on the emerging rumours about 'Maka-Maka' the hotly discussed coming social platform that will apparently tie all Google's online properties into a stream of social attention and activity data.

I mentioned this ambition in September, it seems the rumours back then were true. All that remains to be seen is quite what is going to emerge from all of this. Techcrunch's commentary is spot on and covers all the angles so I'll say no more apart from that I really hope this results in a set of fully open API's and a stream of data (as Techcrunch surmises). That will be an incredibly powerful tool and enable a new surge in development of web apps coming from outside Google, some of which could even compete with Facebook.

How does Orkut fit into this picture? I hope they recreate it as a social hub for your online attention and activity streams.

When it's on Facebook it would seem!

Valleywag has uncovered the rather dubious practices going on at Facebook HQ. Employees at the world's most popular social network have access to every users profile information. Not only that, they have access to a log of all the user profiles you have looked at during your time on the site.

Obviously some people within Facebook have to have open access to the whole database of users and their activities, however to make this open to everyone seems a major breach of privacy to me. I don't want their junior developers reading my wall posts, or their interns knowing who I have added to my top friends (and who I haven't).

This breach of privacy becomes even more worrying when you think about who are members of Facebook. From political candidates to pop stars to Bill Gates and Steve Jobs, all their personal and attention data is available to Facebook employees.

It's unknown whether the data available to employees includes the more sensitive messages and contact details.

It's seen as a perk of the job, but to me this just seems plain wrong!

Many people assume that social networking is a strictly western past time, with the vast majority of users coming from the U.S. and western Europe.

Not true at all! The latest figures from comScore show that it's a truely international phenomenon and is actually being lead by the Asia Pacific region at the moment.
This leads me to deduce that it's not all about Facebook and MySpace. Neither have the presence in these other areas of the world. Orkut, Google's social network offering, is massive in Latin America and making waves in Asia, but something else must be contributing to these Asia Pacific totals.

Engagement wise, it's Latin America leading the way. The average social network user in Latin America spends much more time engaged in social networks than users in North America or Europe. Could it be that Orkut is more engaging than Facebook?
The figures above would seem to suggest that although Asia Pacific are heavy users of social networks they are not as engaged and are using them for different purposes to the Americas (perhaps).

Lastly comScore have a breakdown of the regions with what social networks they prefer.

This is where it suddenly jumps out that Friendster is doing really well in Asia, and that a network called CyWorld accounts for a lot of the numbers in that area but doesn't figure at all in EU or U.S. Also obvious from these figures is that Facebook just doesn't feature in Asia or Latin America, they have a massive opportunity to break into these regions and gain a lot more eyeballs!

Just a quick post to publish some of the thoughts that are appearing on the web about the huge valuation of Facebook. The $15B valuation makes it the 5th most valuable U.S. internet company according to Michael Arrington at Techcrunch .
Is a company with no evidence of profit actually worth such a huge sum? Possibly; it has the traffic (the most important thing for any site which will derive most of it's revenues from advertising), it's just signed a deal with a good technology partner (Microsoft), it's open standards should help it (unless of course MS integrate their services with it, how open would it's platform be then?) and with the current bubble mentality it's likely to get more investment very easily.

The BBC has published 15 reasons why Facebook may actually be worth $15B. Very interesting, my comments interspersed in blue:

1. The network has gone viral in the last 12 months, with more than 50 million users worldwide and a user base that is growing faster than great rival MySpace. According to Facebook, it adds 200,000 new users each day.
Yes, it's certainly a traffic monster! The growth rate is astounding, but that could slow as it must reach a saturation point eventually. The eyeballs is great for advertising revenue though so that should guarantee them a profit (eventually). They need to be careful to avoid the saturation point though, keep it fresh, become the webtop of choice and don't let anyone launch something more interesting (or the fickle web users will forget about you very quickly).

2. The average user spends 3.5 hours a month on Facebook - more than the average user on rival MySpace - which is increasingly attractive to advertisers.
Funny one this; I don't spend long on it at all, in fact I've taken to updating my status via a browser plug-in now. So a lot of people must be using Facebook as their email and communication alternative, that's what they need to do to keep the eyeballs, become a default location for peoples web browsing.

3. Facebook is the current Web 2.0 darling - popular with ordinary users and "tech heads" alike.
Darling of the moment, but it could easily slip from being the techies darling, especially with Microsoft on board.

4. US research reveals that Facebook users come from wealthier homes and are more likely to attend college than MySpace users - increasing that attraction for advertisers.
Not sure on this one; often the more prosperous will be the earlier adopters anyway, and as Facebook descends closer to the more chavy MySpace I believe the demographic will change anyway.

5. Microsoft's investment makes them a serious player in the growing market of "social advertising". Social network profiles are full of personal data that users voluntarily hand over, which is very useful for targeting adverts.
Big point this one! The data Facebook is gleaning is amazingly powerful to an advertising network. Facebook could be one of the first websites to carry adverts that are actually contextual and useful to their targets, this can result in a huge revenue stream if done right.

6. Sixty percent of Facebook users are outside of the US - so Microsoft's investment buys access to a global audience quickly and simply.
Microsofts ad network is global anyway and there are plenty of other places they could have invested in to get a global market. Global doesn't matter as much as size (as the old adage goes).

7. Facebook is the new web: The decision to open up the network to outside developers turned Facebook into a destination for many uses, like messaging, photos and video. Of course, as Facebook is on the web it could never really be the new web.
Facebook could be the newest web if it integrates with Microsoft Live platform... That could be huge and really make it into a webtop.

8. Every major content firm with an online presence is either working on a Facebook application or has already launched one - from Google to the BBC.
Hype; everyone will always try to dive into something new which gains popularity as quickly as Facebook. I don't believe that is any sign of value.

9. According to a report, 233 million hours of work are lost each month in the UK due to staff looking at social networks. Advertisers can now target people when at their desks.
Advertisers have always been able to target people when at their desks, now they can target them on another site where people are actually very engaged and in my opinion less likely to interact with adverts than a traditional site or portal.

10. The openness of Facebook is attracting a wealth of talented developers who can launch their applications to millions of users quickly.
Yes, but this helps those developers make money it doesn't increase Facebooks value directly, only indirectly. Of course the better the developments the greater amount of traffic is attracted...

11. Facebook messaging is the new e-mail. Everyone feels stressed from a deluge of e-mail from unwanted people and companies. But Facebook messages are always from friends.
How long till spam becomes a feature of Facebook??? If Facebook could integrate with Live Mail and become the email destination of choice that would be the coup of the decade.

12. Facebook's "status updates" have become the easiest way to let friends know what you are doing and how you are feeling at any given moment.
Along with Twitter and a multitude of other status alert services. I do like the Facebook status engine, but it can get annoying. We need better ways to filter the types of alerts sent!

13. Facebook thrives on playful applications such as Pirates, Zombies, Super Wall and Top Friends, which have made the network a place to play as well as communicate.
And they add no value! All style no substance this aspect of Facebook, it needs more productivity apps and networking features to be really succesful and not end up another MySpace.

14. Facebook is the acceptable face of blogging - you can reflect your life and personality online without being seen as a "blogger", which often carries a geeky stigma.
Geek? Me??

15. Facebook is worth $15bn only because Microsoft says so. The value of Facebook is based on a 1.6% share of the firm being worth the $240m Microsoft paid for it. Microsoft and Google were in a bidding war for a slice of the firm and both companies have large pockets. This was not just business, this was personal, according to some analysts.
Very true! It will take a market valuation for me to believe it is worth so much, and even if it had one I'm not sure $15B is worth it in it's current state. A year down the line, if it becomes a web starting point of choice then it may command a valuation many times higher!

Some good, thought provoking points from the BBC there!

Okay, maybe a little harsh as headlines go...

Microsoft has invested $240m in Facebook. This guarantees Microsoft the position of exclusive third-party advert provider to the social network. It also gives them a measly stake in the company of under 2%. Facebook has said that it may well take extra funding from other parties in this round of financing.

Great news for Facebook; they go the money they'd been looking for.

Great news for Microsoft; they've secured a highly lucrative advertising deal and got their feet under the table at the biggest thing on the internet (currently). Although the ad revenue is shared with Facebook the potential to get their ads in front of eyeballs is huge and will be a big draw for publishers.

The deal has valued Facebook at $15b; that's a massive sum for a site that isn't returning huge revenues yet. They need to start bringing in the bucks if they are going to keep an investor like Microsoft happy, they won't sit back on their laurels and just be happy with the ad revenue, they'll want to see a return on their investment of some form.

Could we see the integration of the Facebook platform with Office Live, Live Search and Live Mail? That would be a coup for Microsoft and give them the honour of being part of the biggest webtop platform going.

I'm guessing that both Microsoft and Facebook will see this as one in the eye for Google (seeing as Google would have loved to have been a part of this) but I reckon Google may have something up it's sleeve (it usually does).

Edit: Mashable is reporting that Facebook may have secured a further $500m from two hedge funds. The source of this info is not confirmed yet.

It seems that NY State have decided to settle with Facebook over the child safety probe I blogged about a few weeks back.

There's no mention in the Reuters story of exactly what the settlement entails, but Attorney General Andrew Cuomo said that he planned to hold a press conference on Tuesday "to announce a major development involving social networking Web sites."

What could that be? A new law forcing social networks to better protect their users? A law forcing them to expose user data? Or maybe some kind of code of conduct that social networks will have to sign up to? My bet's on a type of code of practice which if you don't sign up to you get your ass sued!

So Google owns a social network called Orkut. I'll forgive you if you didn't know that as it's not the best known of the social media darlings of the moment, that accolade sits with the Facbook, MySpace and Bebo's of this world.

However, Orkut is actually doing really well, organically growing in markets around the world where even Facebook doesn't really get a look in. Orkut is doing really well in both Latin America and the Asia-Pacific regions. In Latin America they command double the traffic of Facebook and MySpace combined with approx 12 million monthly visitors. In Asia-Pacific they command 11 million visitors per month and have recently taken the lead as the most popular social network. In the US however they receive just 600,000 visitors per month, although that is climbing.

Business Week has a good article on Google's social ambitions which muses that they will be releasing a new set of API's for Orkut (around November 5th) and some of their other services, allowing developers to build on these and turning Orkut into a platform (similar to Facebook). Google may take a slightly different tack to Facebook though and open up much more transparently, allowing developers to create much more value from applications than purely poking or throwing things at Facebook pals. Orkut may see apps such as one that allows users to see who is online of their friends on Facebook and vice versa. There's also talks of Orkut and Google Maps mashups, GMail and Calendar apps etc. Sounds much more useful than Facebook already!

Of course the article mentions Socialstream too, which I blogged about in August. That's the biggy! Get this kind of cross platform social network integration working and you're onto a winner. Make your social network the hub for it and you will see immense growth (in my opinion).

I wouldn't write Google off quite yet. Orkut has a lot of potential and Google have the tools and the muscle to make a big dent in the other social networks traffic graphs!

So the backlash has begun. There are groups on Facebook devoted to keeping it free of the kind of useless apps that are popping up daily on the platform and other groups begging it not to turn into another MySpace (which is interesting when MySpace has recently added structure and clarity to profile layouts). Brad Stone wrote a great article in the NY Times about the proliferation of applications for the platform.

And now we have the ultimate app! Dramatic Whitespace is just that, a square of whitespace which you can place on your profile. Developed by a guy called Adam Bildersee it has 21 active users (not bad for something that does nothing).

I get loads of app requests from friends to become anything from a zombie to a keeper of virtual goldfish. Now none of that adds any value to my experience of Facebook, what I want are apps that add functionality, add value, integrate with other web services I use, deliver me useful information and allow me to make Facebook a homepage for my browser. Currently my homepage is Netvibes (including a Facebook app which means I don't have to visit the social network too often) which I love, Facebook has a long, long way to go before it could ever provide that much usefulness.

It must be a sign of social networking success I reckon, first NY State now New Jersey State Attorney General Anne Milgram said on Tuesday her office has subpoenaed Facebook to discover whether convicted sex offenders in the state have profiles on the popular social networking site.

Milgram issued the subpoena on Monday to Facebook along with letters to 11 other social networking sites asking them to compare member accounts against a list of sex offenders.

Facebook has until October 12 to respond to the subpoena, which asks for all information concerning any user identified as a convicted sex offender.

I'm sure there will be more to come from other states as they all jump aboard the legal bandwagon with the latest hyper-successful social networking darling!

Rumours are flying about that Facebook is planning it's own ad network and will end up killing off all the start-ups currently offering those services with Facebook.

It's natural for Facebook to have the desire to own this itself. After all, the data that's so attractive to all these start-ups is sitting on their servers and should be under their control, the fact that they opened the doors and let everyone have access won't matter in their eyes, they can easily shut the pretenders out.

Could be the end of many start-ups working on the best way to integrate ads into Facebook and target them according to the content of profiles.

Of course, Facebook does currently have a deal with Microsoft so they could also be seen as a loser if Facebook do build their own network out.

Mark Zuckerberg has announced a new rewards system for Facebook developers. They are offering up to $250,000 for new, innovative apps built on the Facebook platform. There's been a huge rush to build apps resulting in over 4,000 currently (a lot of which are less than impressive), this should see the hype continue in the developer community and maybe tease out some more valuable applications. Anyone can submit their app and they'll be judged as to their worth with some receiving a cash injection.

In other Facebook news, they've announced that they're brand of JavaScript, the catchily named Facebook Javascript (FBJS), is now out of beta and into version 1.0. This should give developers more hooks into the platform and enable creation of seamless 'web 2.0' style applications to embed into users profiles.

So now developers have more tools at hand to try to win a reward for their apps. How long till the platform hits 10,000 apps? I reckon about three months at this rate!

The rumours are flying around after a Yahoo (YHOO) employee mistakenly let the cat out the bag about a new service called Yahoo Mash. Best guesses at the moment are that it's a social network built on top of exisiting Yahoo 360 technology. Worst guesses are a mashed potato recipe site or that it could just be something to do with presidential debates (how boring!).

Let's hope it's a really good social site which will put the cat amongst the pigeons in social networking land!

Facebook has announced a new era in their service, the era of no-privacy.

Public search listings are coming from today, while profiles have always been searchable by members, now they can be searched by the public at large too. And more worryingly, your public search listing can also get indexed by search engines like Google now.

Facebook has always seemed to favour the walled garden approach to social networking but this shows they are willing to open up the walls and let the public in.

Personally, I'm not too bothered as I wouldn't post anything on my Facebook profile that I didn't want people to see. The people who will be really bothered will be professional networks (Linkedin etc) and white pages search engines as this move brings Facebook firmly into those territories.

Now if I had some spare cash I may be tempted by this!

Forbes report that a groundbreaking patent related to social networking is coming up for auction very soon. The "Jaipuria Patent", U.S. Patent 7,047,202, and a pending continuation-in-part application, which are amongst the foremost patent filings related to the social networking industry. The Jaipuria Patent was filed in 2001 and claims priority to an earlier application filed in India in 2000 -- before the growth of the social networking industry. These patent assets will be offered as Lot 54 at the Ocean Tomo Fall 2007 Live IP Auction on October 25th at the Palmer House Hilton in Chicago.

The patent involves means for building a user and community driven secure social network, flexible privacy features for users in maintaining their online social network, and a means to refer users to one another via a referral network. In addition, the patent covers a social networking technology that is driven by user privacy features - fundamental to all successful social networking services today. Now that all sounds pretty familiar doesn't it?

Other features are (quote from Forbes) 'Among the many social network features disclosed and claimed in the patent and pending application are: fundamental technology used to develop and maintain an online social network; creating an online social network including individual users and groups; searching a social network to identify users and groups for keywords and then identifying a chain of contacts leading to the targeted user or group; flexibility in granting user defined privacy rights and access levels to control availability of user's personal information and contacts with respect to others in user's personal and extended network; process of anonymous referral networking using a link by link request forwarding system; and accessing and using social network via the Internet or wireless devices.'

Now, Facebook, MySpace and Bebo all use these types of functions as fundamental parts of their services. I'm confused as to why the owner of this patent hasn't tried taking legal action in the past. The only reason I can see for selling this is to try to make money from someone who may use it either in a lawsuit or to sell it to an existing network. Although if it hasn't been used up to now then I'm a bit sceptical as to its value. Will be interesting to see what it goes for!

So we've all read the recent reports of businesses banning Facebook, Bebo and MySpace to try to prevent employees wasting time. We've also read the stories about recruiters and employers using social networks to check out prospective hires. Now the TUC (Trade Union Congress) have stepped up and issues some guidelines to help employees and employers make informed decisions about usage in the workplace. They also discuss the possibility of it being discriminatory to not hire someone based on their Facebook profile when they might be the only candidate with one (good point!).

There's some guidelines for TUC members here, and some guidelines aimed at employers here.

It's quite amazing to see something like this happen. The TUC is generally an old school organisation so to see them tackling this kind of issue is testament to the huge popularity and buzz surrounding social networks at the moment.

One day...

I've been blogging recently about the problems with multiple social networks and keeping in touch with everyone and how good it would be to have open standards and API's to allow intercommunication and development between platforms.

Well now someone has taken the brave leap to propose and open standard called Open Friend Format. From their blurb: OpenFriend is a set of standards that allows Social Networks to discover any of your friends already on their networks while still protecting your privacy. The ultimate goal is to standardize and make transparent the user experience between importing and exporting of contacts from various social networks. OpenFriend allows for social networks to implement a standardized way of exporting their contacts and discovering relationships between new and existing users. It also allows for sites to generate documents detailing the relationship between people on different social networks.

This is a great step in the right direction and I for one am right behind this push to standardise and aggregate the networks!

Orkut, the three year old social network from Google (GOOG), has announced that they will be releasing a new look to the site soon. I've been an Orkut member for a while but never really used it as all my contacts are on other networks. I hear it does well in other parts of the world but it has certainly never taken off in the UK (yet).

Google really need to pull something out of the bag if they are to get any momentum going on this product. It doesn't offer anything unique, is not the most intuitive network and really doesn't live up to my expectations of Google. The look and feel refresh may help as it is really tired at the moment.

What they really need is a new hook to bring in the users, something ground breaking that we'd all expect from Google. Mashable discusses SocialStream a unified social network that Google sponsored. This aggregator type approach could be exactly what Orkut needs to break free. I discussed this a while ago and in my opinion Google would be the perfect player to take this concept forwards. Perhaps Orkut is the very platform that could do it?

So I surmised previously (here and here) that some enterprising person may work out a way to scrape Facebook profiles to gather demographic and behavioural data which could then power an ad serving platform. I also asked whether Facebook is just a data gathering exercise...

An article in the Wall Street Journal has been published talking about just these ideas but it turns out that its Facebook who are planning a new advertising system using the data from profiels and the users activities and interactions on their social network.

It's aiming for the holy grail of ad serving tools, to allow it to predict what products and services users may be interested in even before they have specifically mentioned them. Now that would be powerful!

Apparently this is top priority for Facebook workers now. They've got the audience, they've now got outsiders creating apps and building momentum for them now they just need to monetise all that activity.

If they get it right and can make this the most targeted ad platform around, keep their audience and get buy in from advertisers then they will have sealed their fortunes. This has the potential to be Adwords for a social network, and if Facebook can become the communications platform that some think it will then this will be massive!

Note: of course this could all result in a horrible backlash for Facebook if the users decide that using their personal info to target them with ads is unethical...