News Update :

Now Facebook is a Cable Company?

Tuesday, May 20, 2008

When I began this blog, I didn't know much about Facebook and certainly didn't intend to write much about it. Almost a year later--like so many others young and not-so-young--I have a Facebook page. There are over 70 million of us according to the site itself. A couple of weeks ago I asked, only a bit facetiously whether Facebook was the hub of the (Internet) universe. You can answer that question as you wish, but it seems clear that Facebook is a metaphor for much that is happening in the Web 2.0 world. It has a grand vision to be even more.

Chamath Palihapitiya, Facebook Vice President of Product Marketing, described them last week as the "cable company of the Internet." Here's the quote from CNET News:

"We view ourselves as a technology company at our core. We're the cable company creating the pipes, and what they carry is social information and engagement information about people."

To prove his point he quoted the following statistics, again according to CNET:

- The average time to build a Facebook app is between 2 and 15 weeks according to a Facebook survey
- It takes between 1 and 5 people to create the app
- At least 1/4 of the apps running on Facebook have 100,000 active daily users
- About 33% of app makers report profits of up to $500,000 each month.

About the same time Business Week (May 14) reported that the site is undergoing a major redesign to try to "declutter" Facebook pages and, in general, make it easier to use. It quotes Adam Ostrow, editor-in-chief of, as saying that the proliferation of viral apps is making the pages look messy. He describes them as "spam in disguise." Aren't those the same Facebook apps that are bringing in as much as $500,000 a month in revenue?

That spotlights one of the quandries of Web 2.0--how do we give users free rein to do all the things they want to do and still maintain a reasonable degree of control--control over the content on our site, the visual aspect of our site, and the overall site experience?

Bruce Temkin, the head of the customer experience practice at Forrester, points out in the May 14 Business Week article that Facebook must strike a balance between entertainment and usability. "If you take the fun out of Facebook, you've got a big problem." What the site designers have to do is to restore simplicity while maintaining the features that users love. If they can do it, Temkin says the Facebook redesign could be a test case for "what happens at the next level of maturity for a lot of Web 2.0 companies,"

It appears that one solution the Facebook designers are considering is to provide tabs to organize different kinds of content. But it's not the specific solution they come up with, it's how they resolve the clutter problem in a way that doesn't turn off users.

Obviously, it's a problem many sites wish they had--too much activity, too much love! It's also obvious that Facebook is not perfect, having made visible missteps recently from the Beacon advertising platform to blocking Google's Friend Connect that lets people port their profiles from one networking site to another. That hasn't stopped users; it doesn't even appear to have slowed them down. All that makes Facebook's ups and downs something that marketers must watch seriously. Ask two questions: "Can we engage our users in that way?" and "How can we avoid making the same mistake?"
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