I am not a heavy Facebook user - I use it basically to keep up to date with any new developments that may occur on the social networking platform.
That said, I am starting to become concerned about the steps towards monetisation that Facebook is taking.
Facebook relies on user generated content, and the development of applications. The applications especially have helped Facebook "catch" and achieve critical mass.
However, Facebook is now starting to introduce interesting fees to monetise its traffic.
So far, the only one officially confirmed is a fee for developers to have their applications "approved" by Facebook - and we are talking around US$400!
What this means is that there will be more applications that are added for purely commerical reasons, as developers need to get their money back somehow, and this can only mean a degraded experience for users. What it also means is that many of the great applications that really add value to Facebook and don't have commerical motives won't be submitted.
Message to Facebook: your key clients are the Facebook users, not commercial interests. As soon as you prioritise commerical interests over those of the users, you will lose loyalty.
Also, the people that pay the bills will want to have their applications featured more predominantly than they curently are, which means the interface will have to change (again), thus resulting in a negative outcome for the users.
Another fee that I am hearing whispers about is a small monthly charge of around 4 dollars for each user to utilise the service.
Charging for what was previously a free service will cause a degree of backlash, and also leaves a gap in the market for someone prepared to offer the same thing for at no cost (Google can you hear me?). Charging a monthly access fee is an inelegant solution to the problem of monetising traffic.
My key point regarding Facebook is this: people do not value Facebook, they value their connections within a social media construct. If these relationships can be transported easily, which of course they can be, then Facebook becomes an empty shell.
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2 comments:
Hi Peter,
To be honest I actually welcome the developer process changes. What it means is that a human being will actually test every app, and in fact ensure that it is not viral and it will avoid all the nasty apps of the past. I suggest that the cost of the process covers the human time involved in checking as well.
Having said that I personally don't believe that FaceBook is capable of truly delivering a great brand experience and its advertising will forever be limited to targeted smaller advertisers related to content relevant to the facebook environment.
They are resisting OpenID and this will also see them suffer in the long term. They might have an audience of reasonable size, but the audience they have is not interested in traditional advertising. They do not have a business model. Even myspace and Bebo have a model based on content, but given the content in facebook is yours and mine how can they monetise it.
It is a really interesting discussion.
Peter,
Here, here ... user driven content is what fb is all about and definitely wouldn't utilise this communication portal if there to be a fee. Most of the apps are pesky in any case saving Scrabulous which was removed :(
Cheers, Rosalind
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