MattMaroon.com

Some people have asked me why I write about Facebook so much. It isn’t because I hate them, as some have suggested. I don’t. I kind of like Facebook actually. I mean, I could just as easily live without it, but I log in a couple times a week, which probably puts it in my top 10. I log into MySpace maybe once a month, on average, and then only when I get a message, and I’ve never signed up for any other network. Well, LinkedIn, I suppose, but that’s more like a digital business card than true social network, and I don’t really visit that site much.

It isn’t to be contrarian either. I do realize my blog sort of comes off that way sometimes. That’s mostly because I find it more interesting to write about popular opinions I disagree with than ones where I agree. I could explain why I think cloud computing is going to be big in the future (in the business and hosting space anyway, I’m still not buying the “thin client in the home” vision) but what fun is that? I’ll just nod my head silently.

And I don’t write about Facebook to troll or drive traffic. In fact, until a week or so ago, I didn’t have any form of monetization on this blog. I’ve now got SnapTalent, which is actually providing a fantastic CPM rate (relative to what I’ve traditionally gotten with Google Ads) but my traffic is so low, even when I get a few links, that it’s basically irrelevant. And if I were angling to promote my personal brand, right now I’d be far better served writing about sports and getting page views from on Yardbarker.

So I write about them mostly because I just don’t like hype. It blinds people to reality. And the reality, I think, is that Facebook has a lot of traffic, but maybe nowhere to go with it. They’ve got a $15 billion valuation, traffic that appears to be leveling off, and no real monetization prospects. Some or all of those might change, but until they do, it’s a little premature to call them the next Google, or even the next YouTube.

Also, unlike most, I don’t think that they are really that smart. That’s another one I get sick of hearing, how they, as a company, are so brilliant. Maybe when it comes to engineering that’s true. People seem to be complaining a little about its speed and responsiveness these days, but it’s still light years beyond MySpace. Even beyond where MySpace was when it had Facebook’s US traffic.

But remember Beacon? Really, who greenlighted that one? My eight year old cousin could have heard the elevator pitch for that one and realized it was a bad idea.

“Well, what we’re going to do is give people a cookie, and then any time they do anything on a partner site, we’re going to put it in their mini feed whether they like it or not. We’ll spy on them everywhere they go, and then tell all of their friends what they’re doing”

How intelligent can a group of people who approved that idea really be? I wouldn’t even want to put someone that dumb in charge of a Dairy Queen, let alone a tech company. I only wish they had partnered with some porn sites. Imagine this feed entry:

It just boggles me that something so obvious could fly right past them if they’re really that brilliant. I’d be happy to sanity check future ideas for them at a rate of $100 per elevator pitch. It’d be a hell of an hourly rate for me (I could probably do at least 20 an hour) and might be the best ROI any corporation ever earned for them.

Also, my post pointing out why advertising won’t work well for them was a little inaccurate. I should have said that it won’t work as well for them as it does for Google. It still clearly can work, in fact, they’ve already got decent revenues, mainly from it. I imagine that at some point they could scale back the employee base and exist rather happily off of the few hundred million they’re pulling in.

A lot of people pointed out that untargeted ads do work for television. But the problem with Facebook, in that regard, is the medium. A picture is worth a thousand words (or so they say, I’m still a little skeptical of the conversion ratio) and a video is 30-60 pictures per second, plus audio. It’s a lot easier to convince someone to drink your beer by showing them computer-generated talking frogs than it is to do in a few lines of text or a 468×60 animated gif.

And a lot of people don’t understand that about branding ads. It’s all about the content. If people like the content, the ad works. If they don’t, it doesn’t. On television or radio, the content is the commercial. On a website it isn’t the banner, because that’s too small to put anything in. It’s the website you land on once you click the banner. Budweiser doesn’t sell beer from their website. They stamp their brand onto your cerebral cortex, so you’ll buy the beer at a bar or a grocery store.

So if Facebook can’t get the click throughs, they’re still lagging, even with branding type ads. And that’s the problem they’re having. Even though they have better information than a television station and can therefore target much more accurately, the limitations of the medium are just too strong. That’s why TV ads cost 15 dollars CPM and Facebook costs 15 cents.

So they try to go the social route by using friendship and connections to sell you stuff, telling you that this person you know ordered some shoes from Zappos so that maybe you will too. But that’s not going to work for privacy reasons either, as Beacon so clearly showed. People don’t want that happening automatically, and they’re too lazy to do it manually. It’s just more work and more noise for them.

Affinity groups are more or less a joke for that reason. I might love Sam Adams beer, but I’m not going to join any Facebook group for them (even if they had one and I somehow found out about it) and get bombarded by spam. People aren’t opposed to marketing brands they love, but they aren’t going to go out of their way to do it either.

So the long and short of it is that I just don’t think there’s any rational basis for calling Facebook the next Google. And it’s not so much Facebook that I dislike, it’s just the over-hyped tech industry mindset that keeps spitting out that phrase. I’m all for optimism and open-mindedness, and I’ll be the first to admit that maybe somewhere, around some corner that nobody sees, is some fantastic future strategy for social networks. But for now all of the hype is just an industry’s over-inflated collective ego talking.

I really don’t mean to come off as the eternal skeptic, because I’m just not. Hell, I’m running a startup. I just don’t think that irrational exuberance is healthy. There’s a fine line between that and optimism, and I just think that on this one issue, we’re way past it.

This entry was posted on May 22, 2008 at 12:06 pm and is filed under tech . You can follow any responses to this entry through the RSS 2.0 feed Both comments and pings are currently closed.