It’s a podcast, and if you haven’t come across it yet, I strongly recommend it. One central point is that Facebook is an advertising company, which means that freely sharing their data with app developers was a strategic mistake (never mind the privacy issues). They claim that Mark Zuckerberg was too enamored of the platform model and too reluctant to accept an identity as an advertising company. They make the point that regulating Facebook so that it cannot give away data would be good for Facebook and bad for start-ups that otherwise could make use of Facebook’s data.
What they say makes sense, but:
1. Zuckerberg has built a powerful, successful company, and they are just kibbitzers.
2. One can argue that refusing to accept an identity as a ____ company has enabled Amazon and Google to be successful. Amazon has failed at some thinga, but they succeeded as a cloud computing company, and nobody really saw that coming. Google has failed at some things, too, but other things, such as buying YouTube, were successful.
3. In general, it seems as though these companies try to create new opportunities and then see which ones work, rather than decide what to do based on some grand strategy. They create “luck.”
4. Thompson and Allred point out that Facebook “stumbled” into being a dominant advertising platform on mobile. But maybe they stumbled into it in part by making opening up their data to app developers. Maybe if they had kept their platform closed, app developers would have been forced to operate independently, competing with Facebook or working against it rather than with it. As it is, they helped steer Facebook into the mobile market.
Listen to the podcast before making your own comments.
I wonder what Peter Drucker would think about this?
Your reasoning isn’t convincing. Ben is right, but misses the fact that Facebook was correct to attempt to become a platform. The problem for Facebook is that their fate is too connected to mobile. Who ever owns the next big platform could shut them out. For example where is Facebook in voice? Google and Amazon both have assistants, how does Facebook advertise on those platforms? They don’t!
Zuckerberg has always understood this, so he bought oculus, they want to own VR/AR and make socializing through Facebook a big part of it. I don’t think this will be successful, but it’s a solid strategy.
Also Google Bought You Tube it wasn’t something that just worked. Amazon has a grand plan, to take a percent of every commerce transaction that takes place. To be the only middleman. Thus they will eventually get into payments in a big way taking on both banks and credit cards.
These are much more mature companies who are very strategic in what they do.
It really doesn’t matter what the business strategy is. It is the collection and retention of massive amounts of personal data that matters. There is no responsible way to do this without eventual consequence. Regulation cannot fix this. If the data exists, the risks exist.
Eventually, we will have a series of shocks to this model caused by unintended consequences, and that will result in a reorganization of the way the internet and wireless communications are used. Its unfortunate, but it will be simply too easy for bad actors to seize opportunities to exploit and abuse data like this, no matter how careful firms like Google or Facebook are.
One of the main themes of the podcast was that Facebook was not at all careful with the data. They were just giving it away for free.
Google, on the other hand, collects and retains a lot of data, but they’re super tight with it.
It’s a wonder they haven’t bought Cambridge already. No need to share.