Facebook:Internet::Socialism:Free Markets

January 21st, 2009 · No Comments

Photo By: Henrik Bejke

We were discussing the other day about future ventures and Annie basically put forth the contention that “forums were dead.” She said they seemed “archaic” and she didn’t know why anyone would bother making a free standing forum, when they could just make one on Facebook. This was troubling to me for a few reasons:

I Know Diddly About Facebook

One of the first things that troubled me about the whole thing is that I know nothing about Facebook. She is clearly the Facebook master in the organization. I’ve never even bothered to give it the rudimentary attention that I’ve given MySpace (which is next to none). I have no real reason to justify why I’ve been ignoring a huge social change in the area I’m hoping to build businesses in, but there you have it. I’m ignorant. That was the first troubling bit.

She Seemed Right

At first blush, the second troubling fact was that I could totally see her point. We’re out there trying to build communities, when Facebook is basically making all the same tools available to people who aren’t savvy. As Annie puts it, “Grandma won’t join a forum, but Grandma will get on Facebook.” There’s also all the advantages that come from the components being integrated so well. I can go to one control panel and see information about my whole online world. That’s very compelling.

Why Facebook is like Socialism

Finally I hit on why I think Facebook is not destined to take over the Web. It comes down to two things: Efficiency and Innovation.

Facebook is like a centrally planned economy. It’s clean and sanitized and easy to use. It sounds great in theory. Big brains in the sky make the decisions about what tools you need, how you’ll get them and how they’ll be delivered. The bad guys don’t get in and everything is great. In theory that all sounds great.

But just like Socialism, Facebook discourages efficiency. Why? Because no one really has much of a profit motive. They don’t really own their content there. It’s just as hard to compete with someone else’s forum there, but you don’t get any big prize when you win. In the early days that’s not a big problem as you see who the best early adopters are. But once you’re established, it’s really hard to displace the leaders, no matter how fat and lazy they’ve become. Moreover, there’s much less incentive to do so.

Also, Socialism and Facebook inherently deter innovation. On Facebook there’s a simple, “master planned” list of things I can and cannot do. All the innovation has to come from the big brain in the sky. While that helps have a orderly, sterile, nonthreatening environment, it’s bad for innovation. If only Facebook can think of things to do with Facebook, then they will always be trailing in the feature wars.

Thus it seems likely to me that while Facebook can get off to a start with “good” planning. Ultimately they will eventually make mistakes and as long as you are the only one making decisions, you will be the one penalized by your mistakes. I ultimately don’t think there can ever be a “super app” that replaces the Internet as a whole, for those two simple reasons: Efficiency and Innovation.

Categories: Theory

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