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Monday, December 1, 2014

Is Facebook Doomed to Fail?

Published on the Sunday Times (TechSunday) 7th December 2014

The post year 2000 dot-com boom saw a shift from static websites providing information and articles to interactive online social networks.  During July 2003 MySpace started a revolution and less than a year later both Hi5.com and Facebook, at that time called Thefacebook.com and available only to a select few university students, were launched as well.

In the local scene up to 2010 the Hi5 service was still quite popular, but today it seems that Facebook is the cool place to be, or is it?

A technical study published earlier this year by some scholars from Princeton University (see reference below) is using statistical models to compare adoption and abandonment of such social platforms and state that all online networks are bound to face their demise just as happened with Hi5 and Myspace which are practically unused nowadays.  This study argues that abandonment of a particular platform happens just like an infectious disease where contact between people who use Facebook may lead to their peers to join and people who abandon Facebook or start using an alternative may ‘infect’ their friends and pressure them to follow suit.



According to this study Facebook is showing the first stages of desertion and if the mathematical model used in this study is correct we might experience Facebook’s demise in the next few years.  Facebook responded to this study by claiming that the user count has increased substantially in the past months, however the company failed to produce any data showing that such users are interacting and spending more time on the platform itself.  This partial-statement is being interpreting by many as an unacknowledged confirmation of the validity of this same study.

Privacy concerns, online identity theft, advertisement concerns and an increase in downtime are becoming ever-increasing issues and may be the cause as to why many are starting to use other social media networks.  Nevertheless no other online network is yet dominant and anyone choosing to leave Facebook may find that there are many alternatives but the following for each network is still not significant especially in smaller countries like Malta.

Various social networks are offering different services to cater for various needs, many youngsters are opting to migrate onto Snapchat.  Using this platform users may send photos, add text and send to their friends just like Facebook but having the photo and message deleted after a time limit, normally set between 1 to 10 minutes.  This has an added advantage as it leaves no trail on one’s profile of any previous activities or photos which may come back later to haunt the user.  Contrary to Facebook, the photos or messages are also deleted from the company’s own servers and Snapchat is managing to guarantee complete privacy without anyone being able to snoop around someone’s profile.

It seems that this particular online service is gaining traction amongst Maltese youngsters who are leaving Facebook in droves since their parents and family members are also on Facebook and most probably ‘friend’ them to monitor their activities therefore they are either deleting their Facebook account or just not using it at all.

Ello.co is a new social network launched earlier this year and has been dubbed as the Facebook killer.  It’s founder, Paul Budnitz said that he intends to disrupt the social media scene and it seems that to a certain extent he is succeeding thanks to some clever viral marketing techniques.  First of all access to the service is via invitation only for now, meaning that the same scarcity factor is making this service more desirable in the eye of the trendsetters and the fact that the display screen is using a predominantly black and white design is adding to the ‘cool’ factor for this product.


The manifesto of Ello.co, which Budnitz himself wrote, states that “Your social network is owned by advertisers.  Every post you share, every friend you make and every link you follow is tracked and converted into data. Advertisers buy your data so they can show you more ads.”  Which is why the creator of this service is vowing to never show any form of advertising to it’s users and instead is going to use a financial model based on the in-app purchases we all have become accustomed to.  When it launches officially in early 2015 Ello will allow it’s users the opportunity to customize how their page looks for $1 and the ability to change various settings for another dollar instead of relying on income from advertising to fund this project.  Whether user purchases will be enough to turn a profit eventually is hard to say at this stage but venture capitalists seem excited about this particular service and have already invested half a million dollars.  Let us not forget that this network has been around for less than a year.

The founders of Ello have another surprise for us, in May 2015 they are planning a huge online viral marketing campaign which should peak on the 31st May coinciding perfectly with what has become known as ‘quit Facebook day’.  It is calculated that in the USA as much as 33,000 are bowing to pressure from this campaign to close their accounts each year, although most of them don’t stop interacting online therefore it is to be expected that all these users might start migrating en masse to Ello, possibly taking with them their friends as well.

Even Twitter and Linkedin, tough serving a different purpose, are finding an ever growing competition from similar services such as About.Me which is managing to offer a similar service without any irritating advertising or promotional material.  It is instead using a pricing strategy known as a ‘Freemium’ model to finance it’s operation where users are able to use it’s services free of charge whilst they can upgrade to a more robust platform for a small yearly fee.  This service is not yet well known in Malta but it is gaining thrust and increasing presence as it is allowing users to link with their Twitter and Linkedin accounts as well as offering an app which aims to act as an electronic business card.  This could potentially overtake Linkedin in the business reference market.

References:

(1) http://arxiv.org/pdf/1401.4208v1.pdf  - Epidemiological modeling of online social network dynamics. (University of Princeton, 2014)


Original article published on the Sunday Times (Tech-Sunday supplement) on the 19th October 2014:

original article scan link: http://files.ianvella.com/facebookdoomedtofail7dec2014.jpg


Scanned image of original article:





Copyright notice : This article was written by Ian Vella and published on the Sunday Times of Malta.  Copyright may be shared between the mentioned author and entities.  Please do not republish without permission.   



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