Social Networks & Privacy
The Wall Street Journal reporting this morning that Facebook, MySpace and some other social networking sites continue to share (read: sell) users’ personal data.
From the article:
The practice, which most of the companies defended, sends user names or ID numbers tied to personal profiles being viewed when users click on ads. [...] Advertising companies are receiving information that could be used to look up individual profiles, which, depending on the site and the information a user has made public, include such things as a person’s real name, age, hometown and occupation.
All of these sites are doing it to some degree, but Facebook seems to be the worst offender.
For most social-networking sites, the data identified the profile being viewed but not necessarily the person who clicked on the ad or link. But Facebook went further than other sites, in some cases signaling which user name or ID was clicking on the ad as well as the user name or ID of the page being viewed.
It costs a lot of money to run an environment like Facebook or MySpace – infrastructure, servers, bandwidth, site maintenance, programmers, support staff, administration, legal, marketing, etc. There’s no free ride, so they look to make a buck off whatever assets they have — in this case, it’s their users’ capacity to spend. I don’t use Facebook or any of the other sites, but a lot of people enjoy it so I hope they can find a business model that will work without treating their customers like dumb consumatons.
I wonder what would happen if Facebook offered a paid membership option — say, $5 a month — with the assurance that paying members would never have any of their personal info used for any marketing purposes whatsoever, no advertising would show up on their pages, etc. I wonder how many Facebook users would pay for that.
Recent Facebook Statistics state that there are more than 400 million active users, and that 50% log in daily. So you have about 200 million people on there every day. If only 5% of these daily users opted for the $5/month account, that’s 10 million users at $5 per month = $50 million monthly revenue. And that’s just from these membership fees, not counting other advertising or affiliate income they may have.
Could Facebook survive on $50,000,000 per month?
Posted: May 21st, 2010Filed under: Customers, Finance, Security & Privacy, Social Networking Tags: facebook, myspace | No Comments »
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