Dear Facebook. It’s Not Me, It’s You

So, let’s say, hypothetically, one wanted to get break up with Facebook? Just how would one do that?

I heard one person say that swearing off Facebook was a “position of privilege.” It was an odd way of putting it, until I thought about it a bit. This person was right. Much as I’d like to follow in retired tech journalist Walter Mossberg’s footsteps and quit Facebook cold turkey, I don’t think I can. I am not in that position. I am not so privileged.

This is no way condones Facebook and its actions. I’m still pretty pissed off about that. I suspect I might well be in an abusive relationship. I have this suspicion because I looked it up on Mentalhealth.net, a website offered by the American Addictions Centers. According to them, an abusive relationship is

where one thing mistreats or misuses another thing. The important words in this definition are “mistreat” and “misuse”; they imply that there is a standard that describes how things should be treated and used, and that an abuser has violated that standard.

For the most part, only human beings are capable of being abusive, because only human beings are capable of understanding how things should be treated in the first place and then violating that standard anyway.”

That sounds bang on when I think about how Facebook has treated its users and their personal data. And everyone will tell you that if you’re in an unhealthy relationship, you should get out. But it’s not that easy. And that’s because of Metcalfe’s Law. Originally applied to telecommunication networks, it also applies to digitally mediated social networks. Metcalfe’s Law states that states that the value of a telecommunications network is proportional to the square of the number of connected users of the system.”

The example often used is a telephone. If you’re the only person with one, it’s useless. If everyone has one, it’s invaluable. Facebook has about 2.3 billion users worldwide. That’s one out of every three people on this planet. Do the math. That’s a ton of value. It makes Facebook what they call very “sticky” in Silicon Valley.

But it’s not just the number of users that makes Facebook valuable. It’s also the way they use it. Facebook has always intended to become the de facto platform for broad based social connection. As such, it is built of “weak ties” – those social bonds defined by Mark Granovetter almost 50 years ago which connect scattered nodes in a network. To go back to the afore-mentioned “position of privilege” comment, the privilege in this case is a lack of dependence on weak ties.

 

My kids could probably quite Facebook. At least, it would be easier for them then it would be for me. But they also are not in the stage of their life where weak ties are all that important. They use other platforms, like Snapchat, to communicate with their friends. It’s a channel built for strong ties. If they do need to bridge weak ties, they escalate their social postings, first to Instagram, then – finally – to their last resort: Facebook. It’s only through Facebook where they’ll reach parents, aunts, cousins and grandmas all at once.

It’s different for me. I have a lifetime of accumulated weak ties that I need to connect with all the time. And Facebook is the best way to do it. I connect with various groups, relatives, acquaintances and colleagues on an as needed basis.  I also need a Facebook presence for my business, because it’s expected by others that need to connect to me. I don’t have the privilege of severing those ties.

So, I’ve decided that I can’t quit Facebook. At least, not yet. But I can use Facebook differently – more impersonally. I can use it as a connection platform rather than a channel for personal expression. I can make sure as little of my personal data falls into Facebook’s hands as possible. I don’t need to post what I like, how I’m feeling, what my beliefs are or what I do daily. I can close myself off to Facebook, turning this into a passionless relationship. From now on, I’ll consider it a tool –  not a friend, not a confidante, not something I can trust – just a way to connect when I need to. My personal life is none of Facebook’s business – literally.

For me, it’s the first step in preventing more abuse.

The Strange Polarity of Facebook’s Moral Compass

For Facebook, 2018 came in like a lion, and went out like a really pissed off  Godzilla with a savagely bad hangover after the Mother of all New Year’s Eve parties.  In other words, it was not a good year.

As Zuckerberg’s 2018 shuddered to its close, it was disclosed that Facebook and Friends had opened our personal data kimonos for any of their “premier” partners. This was in direct violation of their own data privacy policy, which makes it even more reprehensible than usual. This wasn’t a bone-headed fumbling of our personal information. This was a fully intentional plan to financially benefit from that data in a way we didn’t agree to, hide that fact from us and then deliberately lie about it on more than one occasion.

I was listening to a radio interview of this latest revelation and one of the analysts  – social media expert and author Alexandria Samuel – mused about when it was that Facebook lost its moral compass. She has been familiar with the company since its earliest days, having the opportunity to talk to Mark Zuckerberg personally. In her telling, Zuckerberg is an evangelist that had lost his way, drawn to the dark side by the corporate curse of profit and greed.

But Siva Vaidhyanathan – the Robertson Professor of Modern Media Studies at the University of Virgina –  tells a different story. And it’s one that seems much more plausible to me. Zuckerberg may indeed be an evangelist, although I suspect he’s more of a megalomaniac. Either way, he does have a mission. And that mission is not opposed to corporate skullduggery. It fully embraces it. Zuckerberg believes he’s out to change the world, while making a shitload of money along the way. And he’s fine with that.

That came as a revelation to me. I spent a good part of 2018 wondering how Facebook could have been so horrendously cavalier with our personal data. I put it down to corporate malfeasance. Public companies are not usually paragons of ethical efficacy. This is especially true when ethics and profitability are diametrically opposed to each other. This is the case with Facebook. In order for Facebook to maintain profitability with its current revenue model, it has to do things with our private data we’d rather not know about.

But even given the moral vacuum that can be found in most corporate boardrooms, Facebook’s brand of hubris in the face of increasingly disturbing revelations seems off-note – out of kilter with the normal damage control playbook. Vaidhyanathan’s analysis brings that cognitive dissonance into focus. And it’s a picture that is disturbing on many levels.

siva v photo

Siva Vaidhyanathan

According to Vaidhyanathan, “Zuckerberg has two core principles from which he has never wavered. They are the founding tenets of Facebook. First, the more people use Facebook for more reasons for more time of the day the better those people will be. …  Zuckerberg truly believes that Facebook benefits humanity and we should use it more, not less. What’s good for Facebook is good for the world and vice-versa.

Second, Zuckerberg deeply believes that the records of our interests, opinions, desires, and interactions with others should be shared as widely as possible so that companies like Facebook can make our lives better for us – even without our knowledge or permission.”

Mark Zuckerberg is not the first tech company founder to have a seemingly ruthless god complex and a “bigger than any one of us” mission. Steve Jobs, Bill Gates, Larry Page, Larry Ellison; I could go on. What is different this time is that Zuckerberg’s chosen revenue model runs completely counter to the idea of personal privacy. Yes, Google makes money from advertising, but the vast majority of that is delivered in response to a very intentional and conscious request on the part of the user. Facebook’s gaping vulnerability is that it can only be profitable by doing things of which we’re unaware. As Vaidhyanathan says, “violating our privacy is in Facebook’s DNA.”

Which all leads to the question, “Are we okay with that?” I’ve been thinking about that myself. Obviously, I’m not okay with it. I just spent 720 words telling you so. But will I strip my profile from the platform?

I’m not sure. Give me a week to think about it.

Why Disruption is Becoming More Likely in the Data Marketplace

Another weak, another breach. 500 million records were hacked from Marriott, making it the second largest data breach in history, behind Yahoo’s breach of 3 billion user accounts.

For now. There will probably be a bigger breach. There will definitely be a more painful breach. And by painful, I mean painful to you and me.  It’s in that pain – specifically, the degree of the pain – that the future of how we handle our personal data lies.

Markets innovate along paths of least resistance. Market development is a constantly evolving dynamic tension between innovation and resistance. If there is little resistance, markets will innovate in predictable ways from their current state. If this innovation leads to push back from the market, we encounter resistance.  When markets meet significant resistance, disruption occurs, opening the door for innovation in new directions to get around the resistance of the marketplace.  When we talk about data, we are talking about a market where value is still in the process of defining itself. And it’s in the definition of value where we’ll find the potential market resistance for data.

Individual data is a raw resource. It doesn’t have value until it becomes “Big.” Personal data needs to be aggregated and structured to become valuable. This creates a dilemma for us. Unless we provide the raw material, there is no “big” data possible. This makes it valuable to others, but not necessarily to ourselves.

Up to now, the value we have exchanged our privacy for has been convenience. It’s easier for us to store our credit card data with Amazon so we can enable one-click ordering. And we feel this exchange has been a bargain. But it remains an asymmetrical exchange. Our data has no positive value to us, only negative. We can be hurt by our data, but other than the afore-mentioned exchange for convenience, it doesn’t really help us. That is why we’ve been willing to give it away for so little. But once it’s aggregated and becomes “big”, it has tremendous value to the people we give it to. It also has value to those who wish to steal that data from those who we have entrusted it with. The irony here is that whether that data is in the “right” hands or the “wrong” ones, it can still mean pain for us. The differentiator is the degree of that pain.

Let’s examine the potential harm that could come from sharing our data. How painful could this get? Literally every warning we write about here at Mediapost has data at the core. Just yesterday, fellow Insider Steven Rosenbaum wrote about how the definition of warfare has changed. The fight isn’t for land. War is now waged for our minds. And data is used to target those minds.

Essentially, sharing our data makes us vulnerable to being targeted. And the outcome of that targeting can range from simply annoying to life-alteringly dangerous. Even the fact that we refer to it as targeting should raise a red flag. There’s a reason why we use a term typically associated with a negative outcome for those on the receiving end. You’re very seldom targeted for things that are beneficial to you. And that’s true no matter who’s the one doing the targeting. At its most benign, targeting is used to push some type of messaging – typically advertising – to you. But you could also be targeted by Russian hackers in an attempt to subvert democracy. Most acutely, you could be targeted for financial fraud. Or blackmail. Targeting is almost never a good thing. The degree of harm can vary, but the cause doesn’t. Our data – the data we share willingly – makes targeting possible.

We are in an interesting time for data. We have largely shrugged off the pain of the various breaches that have made it to the news. We still hand over our personal data with little to no thought of the consequences. And because we still participate by providing the raw material, we have enabled the development of an entire data marketplace. We do so because there is no alternative without making sacrifices we are not willing to make. But as the degree of personal pain continues to get dialed up, all the prerequisites of market disruption are being put in place. Breaches will continue. The odds of us being personally affected will continue to climb. And innovators will find solutions to this problem that will be increasingly easy to adopt.

For many, many reasons, I don’t think the current trajectory of the data marketplace is sustainable. I’m betting on disruption.

 

 

We Have to Dig Deeper for the True Disruption threatening Advertising

Ken Auletta had me at “disruption.” I’ve just finished reading his new book, “Frenemies, The Epic Disruption of the Ad Business (and Everything Else).” Regular readers will know that this title would be like catnip to me. Despite the hyperbole he employs, Auletta was speaking my language. As a bonus, Mr. Auletta does appear to be at least an occasional reader, as he did quote me twice in the book.

Frenemies bookThe majority of the disruption, according to Auletta, is happening within the ad biz itself. The “Frenemies” described in the book are the digital disruptors, Facebook, Google and – increasingly – Amazon. And their position of strength is the reams of data they collect. The disrupted are primarily the holding companies like WPP and Publicis.

Auletta’s narrative frame for his book is focused on the fortunes of Michael Kassan – who through his company MediaLink has managed to position himself as the über-connector between the traditional holding companies and the new digital disruptors. Auletta says Kassan is “advertising’s Dolly Levi.” For those of you on the south side of 70, he’s referring to the lead character from the 1964 musical Hello Dolly, a New York City matchmaker.  Auletta skips back and forth between the disrupted – represented by Sir Martin Sorrell and Irwin Gotlieb of WPP, Maurice Levy and Rishad Tobaccowala of Publicis and many of the other usual suspects – and the disruptors – in this case represented mainly by Carolyn Everson, a Facebook VP.

The other narrative device Auletta employs is the battle of Mad Men vs Math Men, which is a little too cutesy for my taste, not to mention hackneyed (the agency I used to work for trundled this same meme out at least 6 years ago). While the battle between the Big Idea and Big Data is an easily found target, I think what we’re missing here is the Big Picture.

Auletta’s take is too short sighted. The digital disruption he documents is indeed happening, but the bigger disruption is not between the holding companies and the new digital, data-rich platforms but between the market and the marketer. The entire advertising industry is based on an exchange that is no longer be valid. Other than one chapter which deals with ad-blocking and another about privacy concerns, Auletta spends little time exploring the consumer’s outright rejection of advertising.

If we’re talking about disruption in the ad biz, we have to borrow the infamously head-scratching quote from Donald Rumsfield:

there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns – the ones we don’t know we don’t know. And if one looks throughout the history of our country and other free countries, it is the latter category that tend to be the difficult ones

Auletta’s book – understandably – deals with the first two categories. After all, it’s pretty hard to write a 358 page book on what you don’t know you don’t know. But as Rumsfeld said, it’s that category where you find your “gotchas.”

If we are really going to look at “epic disruptions” we have look at the foundations, not the increasingly shaky edifices built on those foundations. And the foundation of advertising is the exchange of a consumer’s attention in return for something of value to them. In the past, that has either been entertainment or information. And we – the consumers – placed value on those things because there was no other place to get them. Scarcity confers value. But that is no longer true. Our expectations have changed when it comes to sourcing both information and entertainment.

I’ve stated this before and it’s this quote that Auletta used – twice. While I’m grateful for that, I believe that this disruption in value exchange is not just an interesting aside. It’s the key to the whole thing. I don’t care if your advertising is driven by the smartest AI super-algorithm powered by munching on my personal data. If I didn’t ask to see your ad, I don’t want to see it. Period. I have many choices, and watching intrusive ads are way down my list.

If I’m right, I’m not sure what that means for the future. But this rejection of advertising by the market is the place where those things we don’t know we don’t know live. Yes, advertising holding companies are doomed. But I also think that Facebook’s future as an ad-financed platform is similarly doomed. And that’s certainly not something that made it into Ken Auletta’s book.

 

 

 

 

 

 

 

The Rank and File: Life and Work in a Quantified World

No one likes to be a number – unless, of course – that number is one. Then it’s okay.

Rankings started to be crucial to me back in 1996 when I jumped into the world of search engine optimization. Suddenly, the ten blue links on a search results page took on critical importance. The most important, naturally, was the first result. It turned on the tap for a flow of business many local organizations could only dream of. My company once got a California Mustang part retailer that number one ranking for “Ford Mustang Parts.” The official site of For – Ford.com – was number two. The California business did very well for a few years. We probably made them rich. Then Google came along and the party was over. We soon found that as quickly as that tap could be turned on, it could also be turned off. We and our clients rode the stormy waters of multiple Google updates. We called it the Google dance.

Now that I’m in my second life (third? fourth?) as a tourism operator I’m playing that ranking game again. This time it’s with TripAdvisor. You would not believe how important a top ranking in your category is here. Again, your flow of business can be totally at the mercy of how well you rank.

The problem with TripAdvisor is not so much with the algorithm in the background or the criteria used for ranking. The problem is with the Delta between riches and rags. If you drop below the proverbial fold in TripAdvisor, your tourism business can shrivel up and die. One bad review could be the difference. I feel like I’m dancing the Google dance all over again.

But at least TripAdvisor is what I would call a proximate ranking site. The source of the rankings is closely connected to the core nature of the industry. Tourism is all about experiences. And TripAdvisor is a platform for experience reviews. There is some wiggle room there for gaming the system, but the unintended consequences are kept to a minimum. If you’re in the business of providing good experiences, you should do well in TripAdvisor. And if you pay attention to the feedback on TripAdvisor, your business should improve. This is a circle that is mostly virtuous.

Such is not always the case. Take teaching, for example. Ratemyprofessors.com is a ranking site for teachers and professors, based on feedback from students. If you read through the reviews, it soon becomes obvious that funny, relatable, good-looking profs fare better than those who are less socially gifted. It has become a popularity contest for academics. Certainly, some of those things may factor into the effectiveness of a good educator, but there is a universe of other criteria that are given short-shrift on the site. Teaching is a subtle and complex profession. Is a popular prof necessarily a good prof? If too much reliance is placed on ratings like those found on ratemyprofessors.com, will the need to be popular push some of those other less-rankable attributes to the background?

But let’s step back even a bit further. Along with the need to quantify everything there is also a demand for transparency. Let’s step into another classroom, this time in your local elementary school. The current push is to document what’s happening in the classroom and share it on a special portal that parents have access to. In theory, this sounds great. Increasing collaboration and streamlining the communication triangle between teachers, students and parents should be a major step forward. But it’s here where unintended consequences can run the education process off the rails. Helicopter parents are the most frequent visitors to the portal. They also dominate these new communication channels that are now open to their children’s teachers. And – if you know a helicopter parent – you know these are people who have no problem picking up the phone and calling the school administrator or even the local school board to complain about a teacher. Suddenly, teachers feel they’re constantly under the microscope. They alter their teaching style and course content to appeal to the types of parents that are constantly monitoring them.

Even worse, the teacher finds themselves constantly interrupting their own lesson in order to document what’s going on to keep these parents satisfied. What appears to be happening in the classroom through social media becomes more important than what’s actually happening in the classroom. If you’ve ever tried to actively present to a group and also document what’s happening at the same time, you know how impossible this can be. Pity then the poor teacher of your children.

There is a quote that is often (incorrectly) attributed to management guru Peter Drucker, “If you can’t measure it, you can’t manage it.” The reality is a lot more nuanced. As we’re finding out, what you’re actually measuring matters a lot. It may be leading you in completely the wrong direction.

Our Trust Issues with Advertising Based Revenue Models

Facebook’s in the soup again. They’re getting their hands slapped for tracking our location. And I have to ask, why is anyone surprised they’re tracking our location? I’ve said this before, but I’ll say it again. What is good for us is not good for Facebook’s revenue model. And vice versa. Social platforms should never be driven by advertising. Period. Advertising requires targeting. And when you combine prospect targeting and the digital residue of our online activities, bad things are bound to happen. It’s inevitable, and it’s going to get worse. Facebook’s future earnings absolutely dictate that they have to try to get us to spend more time on their platform and they have to be more invasive about tracking what we do with that time. Their walled data garden and their reluctance to give us a peak at what’s happening inside should be massive red flags.

Our social activities are already starting to fragment across multiple platforms – and multiple accounts within each of those platforms. We are socially complex people and it’s naïve to think that all that complexity could be contained within any one ecosystem – even one as sprawling as Facebook’s.  In our real lives – you know – the life you lead when you’re not staring at your phone – our social activities are as varied as our moods, our activities, our environment and the people we are currently sharing that environment with. Being social is not a single aspect of our lives. It is the connecting tissue of all that we are. It binds all the things we do into a tapestry of experience. It reflects who we are and our identities are shaped by it. Even when we’re alone, as I am while writing this column, we are being social. I am communicating with each of you and the things I am communicated are shaped by my own social experiences.

My point here is that being social is not something we turn on and off. We don’t go somewhere to be social. We are social. To reduce social complexity and try to contain it within an online ecosystem is a fool’s errand. Trying to support it with advertising just makes it worse. A revenue model based on advertising is self-limiting. It has always been a path of least resistance, which is why it’s so commonly used. It places no financial hurdles on the path to adoption. We have never had to pay money to use Facebook, or Instagram, or Snapchat. But we do pay with our privacy. And eventually, after the inevitable security breaches, we also lose our trust. That lack of trust limits the effectiveness of any social medium.

Of course, it’s not just social media that suffers from the trust issues that come with advertising-based revenue. This advertising driven path has worked up to now because trust was never really an issue. We took comfort in our perceived anonymity in the eyes of the marketer. We were part of a faceless, nameless mass market that traded attention for access to information and entertainment. Advertising works well with mass. As I mentioned, there are no obstacles to adoption. It was the easiest way to assemble the biggest possible audience. But we now market one to one. And as the ones on the receiving end, we are now increasingly seeking functionality. That is a fundamentally different precept. When we seek to do things, rather than passively consume content, we can no longer remain anonymous. We make choices, we go places, we buy stuff, we do things. In doing this, we leave indelible footprints which are easy to track and aggregate.

Our online and offline lives have now melded to the point where we need – and expect – something more than a collection of platforms offering fragmented functionality. What we need is a highly personalized OS, a foundational operating system that is intimately designed just for us and connects the dots of functionality. This is already happening in bits and pieces through the data we surrender when we participate in the online world. But that data lives in thousands of different walled gardens, including the social platforms we use. Then that data is used to target advertising to us. And we hate advertising. It’s a fundamentally flawed contract that we will – given a viable alternative – opt out of. We don’t trust the social platforms we use and we’re right not to. If we had any idea of depth or degree of personal information they have about us, we would be aghast.  I have said before that we are willing to trade privacy for functionality and I still believe this. But once our trust has been broken, we are less willing to surrender that private data, which is essential to the continued profitability of an ad-supported platform.

We need to own our own data. This isn’t so much to protect our privacy as it is to build a new trust contract that will allow that data to be used more effectively for our own purposes and not that of a corporation whose only motive is to increase their own profit. We need to remove the limits imposed by a flawed functionality offering based on serving ads that we don’t want to us. If we’re looking for the true disruptor in advertising, that’s it in nutshell.

 

Rethinking Media

I was going to write about the Facebook/Google duopoly, but I got sidetracked by this question, “If Google and Facebook are a duopoly, what is the market they are controlling?” The market, in this case, is online marketing, of which they carve out a whopping 61% of all revenue. That’s advertising revenue. And yet, we have Mark Zuckerberg testifying this spring in front of Congress that he is not a media company…

“I consider us to be a technology company because the primary thing that we do is have engineers who write code and build product and services for other people”

That may be an interesting position to take, but his adoption of a media-based revenue model doesn’t pass the smell test. Facebook makes revenue from advertising and you can only sell advertising if you are a medium. The definition of media literally means an intervening agency that provides a means of communication. The trade-off for providing that means is that you get to monetize it by allowing advertisers to piggyback on that communication flow. There is nothing in the definition of “media” about content creation.

Google has also used this defense. The common thread seems to be that they are exempt from the legal checks and balances normally associated with media because they don’t produce content. But they do accept content, they do have an audience and they do profit from connecting these two through advertising. It is disingenuous to try to split legal hairs in order to avoid the responsibility that comes from their position as a mediator.

But this all brings up the question:  what is “media”? We use the term a lot. It’s in the masthead of this website. It’s on the title slug of this daily column. We have extended our working definition of media, which was formed in an entirely different world, as a guide to what it might be in the future. It’s not working. We should stop.

First of all, definitions depend on stability, and the worlds of media and advertising are definitely not stable. We are in the middle of a massive upheaval. Secondly, definitions are mental labels. Labels are short cuts we use so we don’t have to think about what something really is. And I’m arguing that we should be thinking long and hard about what media is now and what it might become in the future.

I can accept that technology companies want to disintermediate, democratize and eliminate transactional friction. That’s what technology companies do. They embrace elegance –  in the scientific sense – as the simplest possible solution to something. What Facebook and Google have done is simplified the concept of media back to its original definition: the plural of medium, which is something that sits in the middle. In fact – by this definition – Google and Facebook are truer media than CNN, the New York Times or Breitbart. They sit in between content creators and content consumers. They have disintermediated the distribution of content. They are trying to reap all the benefits of a stripped down and more profitable working model of media while trying to downplay the responsibility that comes with the position they now hold. In Facebook’s case, this is particularly worrisome because they are also aggregating and distributing that content in a way that leads to false assumptions and dangerous network effects.

Media as we used to know it gradually evolved a check and balance process of editorial oversight and journalistic integrity that sat between the content they created and the audience that would consume it. Facebook and Google consider those things transactional friction. They were part of an inelegant system. These “technology companies” did their best to eliminate those human dependent checks and balances while retaining the revenue models that used to subsidize them.

We are still going to need media in a technological future. Whether they be platforms or publishers, we are going to depend on and trust certain destinations for our information. We will become their audience and in exchange they will have the opportunity to monetize this audience. All this should not come cheaply. If they are to be our chosen mediators, they have to live up to their end of the bargain.