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Social Networking
A large but long-in-the-tooth technology company hoping to become a bigger force in online advertising buys a small start-up in a sector that everybody agrees is the next big thing. A decade ago, this was Microsoft buying Hotmail--the firm that established web-based e-mail as a must-have service for internet users, and promised to drive up page views, and thus advertising inventory, on the software giant’s websites. This month it was AOL, a struggling web portal (入口网站) that is part of Time Warner, an old-media giant, buying Bebo, a small but up-and-coming online social network, for $ 850m.
Both deals, in their respective decades, illustrate a great paradox of the internet in that the premise underlying them is precisely half right and half wrong. The correct half is that a next big thing--web-mall then, social networking now--can indeed quickly become something that consumers expect from their favorite web portal. The non sequitur(推论，结论) is to assume that the new service will be a revenue-generating business in its own right.
Web-mall has certainly not become a business. Admittedly, Google, Microsoft, Yahoo!, AOL and other providers of web-mall accounts do place advertisements on their web-mail offerings, but this is small beer. They offer e-mail--and volumes of free archival (档案的) storage unimaginable a decade ago--because the service, including its associated address book, calendar, and other features, is cheap to deliver and keeps consumers engaged with their brands and websites, making users more likely to visit affiliated pages where advertising is more effective.
Social networking appears to be similar in this regard. The big internet and media companies have bid up the implicit valuations of MySpace, Facebook and others. But that does not mean there is a working revenue model. Sergey Brin, Google’s co-founder, recently admitted that Google’s "social networking inventory as a whole" was proving problematic and that the "monetization work we were doing there didn’t pan out as well as we had hoped". Google has a contractual agreement with News Corp to place advertisements on its network, MySpace, and also owns its own network, Orkut. Clearly, Google is not making money from either.
Facebook, now allied to Microsoft, has fared worse. Its grand attempt to redefine the advertising industry by pioneering a new approach to social marketing, called Beacon, failed completely. Facebook’s idea was to inform a user’s friends whenever he bought something at certain online retailers, by running a small announcement inside the friends’ "news feeds". In theory, this was to become a new recommendation economy, an algorithmic (算术的) form of word of mouth. In practice, users rebelled and privacy watchdogs cried foul. Mark Zuckerberg, Facebook’s founder, admitted in December that "we simply did a bad job with this release" and apologized.
So it is entirely conceivable that social networking, like web-mail, will never make oodles of money. That, however, in no way detracts from its enormous utility. Social networking has made explicit the connections between people, so that a thriving ecosystem of small programs can exploit this "social graph" to enable friends to interact via games, greetings, video clips and so on.
But should users really have to visit a specific website to do this sort of thing "We will look back to 2008 and think that we had to go to a destination like Facebook or LinkedIn to be social," says Charlene IA at Forrester Research, a consultancy. Future social networks, she thinks, "will be anywhere and everywhere we need and want them to be". No more logging on to Facebook just to see the "news feed" of updates from your friends; instead it will come straight to your e-mail inbox, RSS reader or instant messenger. No need to upload photos to Facebook to show them to friends, since those with privacy permissions in your electronic address book can automatically get them.
The problem with today’s social networks is that they are often closed to the outside web. The big networks have decided to be "open’ toward independent programmers, to encourage them to write fun new software for them. But they are reluctant to become equally open towards their users, because the networks’ lofty valuations depend on maximizing their page views-so they maintain a tight grip on their users’ information, to ensure that they keep coming back. As a result, avid internet users often maintain separate accounts on several social networks, instant-messaging services, photo-sharing and blogging sites, and usually cannot even send simple messages from one to the other. They must invite the same friends to each service separately. It is a drag.
Historically, online media tend to start this way. The early services, such as CompuServe, Prodigy or AOL, began as "walled gardens" before they opened up to become websites. The early e-mail services could send messages only within their own walls (rather as Facebook’s messaging does today). Instant-messaging, too, started closed, but is gradually opening up. In social networking, this evolution is just beginning. Parts of the industry are collaborating in a "data portability workgroup" to let people move their friend lists and other information around the web. Others are pushing Open ID, a plan to create a single, federated sign-on system that people can use across many sites.
The opening of social networks may now accelerate thanks to that older next big thing, webmail. As a technology, mall has come to seem rather old-fashioned. But Google, Yahoo!, Microsoft and other firms are now discovering that they may already have the ideal infrastructure (基础设施) for social networking in the form of the address books, in-boxes and calendars of their users. "E-mail in the wider sense is the most important social network," says David Ascher, who manages Thunder-bird, a cutting-edge open-source e-mail application, for the Mozilla Foundation, which also oversees the popular Firefox web browser.
That is because the extended in-box contains invaluable and dynamically updated information about human connections. On Facebook, a social graph notoriously deteriorates after the initial thrill of finding old friends from school wears off. By contrast, an e-mail account has access to the entire address book and can infer information from the frequency and intensity of contact as it occurs. Joe gets e-malls from Jack and Jane, but opens only Jane’s; Joe has Jane in his calendar tomorrow, and is instant-messaging with her right now; Joe tagged Jack "work only" in his address book. Perhaps Joe’s party photos should be visible to Jane, but not Jack.
This kind of social intelligence can be applied across many services on the open web. Better yet, if there is no pressure to make a business out of it, it can remain intimate, and discreet. Facebook has an economic incentive to publish ever more data about its users, says Mr Ascher, whereas Thunderbird, which is an open-source project, can let users minimise what they share. Social networking may end up being everywhere, and yet nowhere.
The providers of web-mail like Google, Microsoft and Yahoo!, have reaped huge profits by placing advertisements.