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David Silversmith

Facebook Policy Changes Reflect New Realities of Online Data

2/17/2009 29 comments
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Facebook's changes to its data ownership policies have created an uproar in some quarters. Essentially, the company has said, once you load data on their servers, it's their data. All Facebook has done is to change its terms and conditions to reflect technical reality, monetary reality, and plain old reality. And I say more power to them and to Mark Zuckerberg for standing behind the change.

First let's look at technical reality. Facebook makes backups all the time (at least I hope it does) and it has data on more than one server. Is it technically even feasible for them to delete all your data? That would mean deleting the data of each server that ever had the data; deleting the data off each backup medium that ever had the data; and scrubbing the media to ensure that the deleted data can't be recovered. Oh sure, I think Facebook should do that for us. Every time somebody deletes a photo, an email, or an entire account -- Facebook should make all digital record of this go away. Folks, that's not realistic, and kudos to Facebook for stating the technical reality of social media.

Next consider the monetary issues. Facebook is in business to make money while helping people connect. It's not focused on people connecting for free -- it's a business in search of revenue. Now, according to its terms and conditions, it "may use information in your profile without identifying you as an individual to third parties." If Facebook identifies you personally, then it should burn in the hell known as public and media outrage. But summary data: There's gold in them thar hills. Just one example: Research companies administer millions of surveys each year to find out what people like and don’t like. Facebook has all that data and more! Selling that summary-level data would pay for a lot of servers and a lot of shareholder happiness. I don't know what Facebook's plans are with regard to this data -- but I know they want to make money!

More important than technical and monetary reality is just plain old reality -- physical, real-world reality. The data has been posted on a Website. One of your Facebook friends could have done a screen capture of the data; they could have copied the data and pasted it into other documents, or, heck, they could have hired monks in Tibet to transcribe the data. If you suddenly become famous and delete your page, data may still be in the browser cache on their PC. The genie is out of the bottle. You made the data public -- you have no control over what other people do with that data. Facebook cannot be expected to block all the people who viewed your data from abusing that data!

There is a solution if you are concerned about the privacy of your data -- don’t make it public! Social media is fun. It offers a great way to make connections -- but it comes with risks! Borrowing liberally from an old bumper sticker, Facebook does not post embarrassing information... people do.

— David Silversmith, Internet and Web analytics consultant, and former CTO of Carfax

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aum007
Rank: Cyborg
Monday February 23, 2009 8:53:17 AM
no ratings

We all knew well in advance that Facebook had to and always did use Users Private data for its own purposes,what was the need for them to come out in the open about the whole thing?

It unneccesarily creates negative feedback for the company.Everything David says here is absolutely right,you should'nt blame others for your Personal actions of putting all yoru Personal Data online in the first place.Its stupidity and especially since nowadays Employers (existing as well as Prospective) monitor Social Networks for indiscretions from Employees.

So its your decision and your Decision only.

But its good that Privacy Advocates and the Over 25 crowd is creating such a fuss now,it will put a few roadblacks in Facebooks path as they look for ways to monetize all this valuable User Data.But for the Under 25 and especially the Under 15 generation its no real big deal that all their most intimate,private moments are online.Maybe perceptions will change with time .

In the meantime we have to Wake up and live upto it.

Ashish.

 

ktroulos
IQ Crew
Sunday February 22, 2009 5:52:54 PM

Well, it seems that Facebook is trying to set up a 2-sided market model. In that particular model, a firm acts as an intermediator between interested parties. Data can be sold as is (with some sort of manipulation to hide user identifying information, maybe) or it can be "offered" on some fee to adv. firms for better targetted ad campaigns. The possibilities are obviously endless.

Examples of two sided markets are auction platforms (ie ebay), stock exchanges etc. Even services hubs can be considered as a two-sided markets (ie airports).

Analogous models are also applied by traditional press. Newspapers are sold well below their real/actual cost in order to achieve a critical mass of subscribers, thus, making it attractive to commercial firms to advertise inside their pages.

The ethics behind such use of data is an issue for discussion, but I agree with the author that as soon as you place your data in the internet, it stops being private! Even worse, they can be stored in caches for years! (I still can find in google search emails I sent 15-20 years ago!)

DavidSilversmith
Thinkernetter
Friday February 20, 2009 11:22:36 PM
no ratings

Leaked numbers show that Facebook is not making all that much money from advertising. Estimates are around 180 million in ad revenue or about 15 million a month.  Not chump change but the majority of that is tied to two deals with Microsoft where and it is doubtful that Micrsoft will pony up that much money in the future. 

Also the growth from 2007 to 2008 was only 30 million.  Again, not chump change but when you consider their time on site growth and visitor growth not to good.  Facebook gets a lot of traffic - but a lot of it is underage traffic - folks who don't have credit cards to buy online.  So they are not able to charge top dollar for the ads they sell.

 

 

dbergman
IQ Crew
Friday February 20, 2009 11:08:43 PM
no ratings
What is also great about Facebook capitialism is that advertisers themselves can maek money as well. Yes, Facebook makes money by selling advetising space, but also the places the advetise there will reap benefits  if they advertise well. So, it is not just Facebook.
kebedama
Rank: Cave Painter
Thursday February 19, 2009 9:20:39 AM
no ratings

Web 2.0 is a big business , but american people are among the foirst  nation that understood is business earlier .

FACEBOOK showinghight marketing , today i read on TWITTER that facebook is allowing user to make money on it's platform , that's why i ask who will follow facebook on it's innovation ?

Facebook is making millions of dollar per months from advertising , they feel that's not  bad to share revenues with users .

jwallace
IQ Crew
Wednesday February 18, 2009 7:39:00 PM
no ratings

Hi David,

Thanks to the current economic state, breath taking web2.0 companies no longer should be the target of profits(MONETIZE)...as business entities in GENERAL..wait (local governments too?) are struggling to stay an inch above water.

As we pull out of this recession/modern day depression, well positioned web2.0 companies are going to stuff dingy socks in many of those naysayer's yappers.  I personally cannot wait to see that in action.

I really enjoyed your blog!

DavidSilversmith
Thinkernetter
Wednesday February 18, 2009 1:52:32 PM

Money, Money, Money - Web 2.0 gotta make some of this in 2009.  Matthrew Igram's blog on "YouTube experimenting with download fees" has a great discussion on this.

I think there are ways.  What if facebook charged 1 dollar a month - 12 bucks a year for an account. Given their number of users - even if half dropped out - or dropped to a level with less features - that is still a lot of cash to collect. 

Also a lot of teenagers begging parents to use their credit card for online payment - but that's for another blog...

kalwar.g
Researcher
Wednesday February 18, 2009 1:33:29 PM
no ratings

I do not know where these Social Networking web pages are going to land oneday.May be they have to shut down soon.

No advertising, No revenues and No Royalties...

 Sad beginning to new world is emerging soon...

DavidSilversmith
Thinkernetter
Wednesday February 18, 2009 12:38:44 PM
no ratings

In both the old (now the current) and the briefly posted guidelines they are always committed to protecting your privacy. 

Could they use one of your crowd photos and sell it as a stock photo - maybe, interesting question.

Could they use your name, birthday, phone number - no and I think they know that would be a pretty bad business model. 

Could they use your information in summary data - X number of people in this ZIP are fans of Bruce Springsteen - yes.  How many people belong to music facebook groups.  How many people belong to book club facebook groups. 

I think that Facebook has felt the backlash of a poor announcement - but I continue to feel that it is a free service that folks are choosing to use.  You are providing eyeballs to look at ads and summary level data - if not for that somebody needs to start paying $$$ to Facebook.

softomic
Rank: Web master
Wednesday February 18, 2009 12:29:43 PM
no ratings
I'm not sure what content on Facebook that I post would be worth fighting over, but I'd be a little pissed (after being flattered) if they sold one of my photos or quoted me and didn't pay any royalties...I know...that would never happen, but what if you saw an ad like this: Pay $20/month subscription fee for full access to the Facebook universe which includes everyone's name, birthday, address, and headshot and any messages they ever posted.  That would suck.
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