Facebook’s Take on Beacon: Mistakes = Innovation

Facebook has said very little about Beacon lately. Surely the company is putting some, um, tweaks on the program, which angered users whose purchases on sites outside of Facebook were beamed back to their Facebook friends without their permission.

I guess if you’re leaving the company, you have more leeway to talk. According to a PaidContent.org interview with Owen Van Natta, the chief revenue officer who will be departing the company shortly:

“The ability to learn from [mistakes], will unlock the benefits of this kind of media. I was at Amazon.com when it started and the book publishers were nervous about letting consumers put reviews up. They only wanted the good review, not the bad ones. But the thing is, the good reviews only have credibility when you have the courage to put negative opinion alongside them. So Amazon changed that view in the retail industry and social media’s doing the same for every other brand on the planet.”

Personally I think Facebook needs to do a big sitdown with one of the leading business pubs and get it all out in the open. You innovate, mess up, clean it up and then move on. And then tell the world how you did it.

Update: WSJ published a story on March 5 that touched on these issues (and recapped a lot of what has already been reported about Facebook). If you’re a registered user you can find the article here.

The IAB Has Arrived

Am attending the IAB Ecosystem conference in Phoenix, and what looked a few weeks ago like a sleepy little confab has turned into the event of the spring season. The Tapatio Cliffs Resort is sold out, they tell me.

Given that it’s the IAB’s show I expected to see the Web media heavy hitters here, but what I didn’t expect were all of the agency folks. Even the hotel staffers seem tickled by the “celebrities” here. Twice in the space of 10 minutes people exclaimed to me about all the “big names” here - Yahoo, AOL, Google, etc.

Yes, a decade after I attended one of the first IAB conferences, this industry has arrived. In Phoenix.

 

How Has Social Networking Impacted Society?

Those of you who are interested in the human side of social networking (rather than the marketing side, wink) should check this out. The New York Times’ Freakonomics blog asked several notable academics about the effect of social networking on society. Their thoughts are gathered here.

Facebook Needs to Stand up to Rogue Apps

Facebook’s modus operandi almost since its inception has been to launch a feature, listen to feedback from users, and then tweak it. Standard operating procedure for thousands of businesses, right?

Remember the News Feed launch and the huge uproar over that? And what about Beacon? The problem is that the amount of time Facebook waits before making changes is getting too long for comfort.

Case in point: yesterday, Facebook announced a series of changes designed to reduce application spam. You know - the apps that force you to invite friends so you can see the results of the quiz you just took, or the ones that send mail to your personal email account (such as the Movies app that spammed me 5 times over the weekend).

According to the Facebook Blog (emphasis mine):

• When you get a request from an application, you now have the ability to “Block Application” directly from the request. If you block an application, it will not be able to send you any more requests.




• A few weeks ago, we added the ability to “Clear All” requests from your requests page when you have a lot of requests and invitations that you haven’t responded to yet.




• Your feedback now determines how many communications an application can send. When invitations and notifications are ignored, blocked, or marked as spam, Facebook reduces that application’s ability to send more. Applications forcing their users to send spammy invitations can wind up with no invitations at all. The power is in your hands; block applications that are bothering you, and report spammy or abusive communications, and we’ll restrict the application.




• We’ve explicitly told developers they cannot dead-end you in an “Invite your Friends” loop. If you are trapped by an application, look for a link to report that “This application is forcing me to invite friends”. Your reports will help us stop this behavior.




• We’ve added an option to the Edit Applications page that allows you to opt-out of emails sent from applications you’ve already added. When you add a new application, you can uncheck this option right away.




• Applications must now give you advanced warning if you’ll need to invite friends to get information or access content. So you should always know ahead of time if that quiz you’re taking will require you to invite friends to see your results. If you see applications withholding content without warning, go to that application’s About page to report it.

The changes come only after Facebook members griped for months about spammy apps. And notably (see the boldfaced sentences above), Facebook isn’t being nearly as aggressive as members may have hoped. Instead of simply banning rogue apps, Facebook tells members that THEY have to do the complaining.

I think it’s time for Facebook to take more responsibility within the app ecosystem it created. ISPs routinely blacklist email spammers. Facebook ought to do the same for bad apps.

A New View of the Walled Garden

A lot of people have referred to social networks as the new “walled gardens” - a metaphor that harks back to the days of the dial-up online services America Online, CompuServe and Prodigy. Each was its own walled garden with its own content, email system and navigation method.

Now the term has morphed to describe the way people spend time on social networks - doing everything they can within that environment instead of venturing out to the larger Web.

The term has always puzzled me because it’s not like traffic to portals or many other sites is diminishing.

Now, Esther Dyson, the legendary tech thinker, has a twist on the definition, and I think it’s a smart one.

In an opinion column appearing in the Feb. 11 Wall Street Journal (subscription probably required) she writes that consumers will increasingly want to control their interactions with other people and with advertisers:

“Each user determines who will get into his own garden, whether friends or vendors. … Value is being created in users’ own walled gardens, which they will cultivate for themselves in real estate owned by the social networks.” 

I question whether all people will cultivate these gardens within the social networks, but the idea of a walled garden being a person’s own domain on the Internet makes a lot of sense. It may not be a physical “page” or “profile” but something more ephemeral. A virtual garden, if you will.

Consumers will increasingly demand to control how marketers interact with them, when and for how long. Smart marketers will help nurture their walled gardens, rather than tearing them down.

MySpace Learns From Facebook

Yesterday, MySpace finally launched its developer network. Soon, you’ll be able to bite, pinch and slap your friends on MySpace just like you did on Facebook.

Although MySpace is 9 months late to the third-party-application party (Facebook opened its platform last May), it’s clear that the social networking giant has learned something from Facebook’s experience thus far:

1. App developers can use MySpace tools to sell advertising. This is smart because it allows MySpace to keep its hand in the game. Facebook’s hands-off approach means apps have to come up with ad strategies on their own. Developers don’t have to use MySpace’s tools, but they will undoubtably make it easier for apps to generate revenue.

2.  Apps are hosted on MySpace servers. Correct me if I’m wrong about this, but I’m pretty sure Facebook apps are hosted on third-party servers outside of Facebook. If that’s the case, then MySpace probably will have a lot more visibility into how the apps work and the way they interact with user data. Some of the problems Facebook has had with rogue apps using deceptive practices may not happen on MySpace.

3. Apps must pass a “safety review process.” All apps running on MySpace will need to go through a safety check to make sure they don’t overstep privacy boundaries, according to a company statement.

The true test will be whether developers will flock to MySpace as they have to Facebook (now with 15,000+ apps and counting).  But surely the parameters outlined above will bring more legitimacy to the app marketplace.

Fox Interactive revenue grows on Google’s back

Looks like Fox Interactive Media got the better end of its deal with Google.

Just last week, Google was bemoaning during its earnings call that “social networking inventory is not monetizing as well as expected,” in the words of Google’s George Reyes.

Today, News Corp. touted search as a leading driver of revenue growth at FIM in its latest fiscal quarter.  “Our revenue from Google is guaranteed; that’s not a particular issue for us,” News Corp.’s Peter Chernin said during the earnings call this afternoon.

Search accounts for between one-quarter to one-third of revenue at Fox Interactive Media, Chernin said.

Company execs also touted MySpace’s new HyperTargeting platform as a revenue driver. The site now offers targeting in more than 750 categories, with the goal of getting to 1,000 by July. The most popular segments are fashion, consumer electronics, videogames and financial services, all of which are categories where marketers had formerly shied away, News Corp. said.

The Industry Standard. It’s Baaaaack!

Yesterday, when I was looking for a Seahawks cap to wear to the Super Bowl party I was going to, I found my old IndustryStandard.com cap. It’s now nearly 10 years old.

Just in time for that little anniversary, The Industry Standard is back. Here’s part of the email that arrived with the news:

You were one of the first in line to ask to see the brand-new Industry Standard. To show our appreciation for your interest, you are being notified of today’s official launch!

The site is not only designed to give readers insights into technology and the Internet economy, but also provides a unique community feature — a predictive market. Read the links below to understand how the site works, and see today’s selection of news, analysis, and predictions:

A message from General Manager Derek Butcher: The launch of a new Standard
Founded in April of 1998, the original Industry Standard helped define an era. Ten years later, a reborn Industry Standard is here to document the new Internet age. …
http://www.thestandard.com/news/2008/02/04/launch-new-standard

I wasn’t there until the magazine’s bitter end, so I have little of that baggage, but I still have mixed feelings about this new site. I think it will be next to impossible to recapture the buzz, the excitement and the must-read status that the magazine one held.

With so many places to get news, insider information and commentary, it will be a challenge for this site to stand out.