“Facebook is worth $100 billion, but all I got was this lousy status update.” That just about sums up the type of public sentiment that has been inundating the Internet over the past few weeks. Facebook’s much-anticipated $100 billion IPO is almost ready to hit the market after a circus-like roadshow where Zuckerberg was chided for, among other things, wearing a black hoodie.
At a time when Facebook promises to transform hundreds of investors and employers into paper millionaires, the site’s 900 million users are wondering: What about me? The site, which rocketed to fame and fortune by selling advertising based on the personal data of its users, will leave almost all of them empty-handed.
As a result, we have people gloating over the site's disenchanted advertisers. We have snide opinions suggesting that Facebook might be the next MySpace or Friendster. We have the articles suggesting that Facebook could disappear within five years. And we have the constant inferences that Zuck is still just too callow to actually deal with the “Grown-Ups” (i.e. People With Money). Facebook, quite simply, is turning into one of those companies that we love to hate. At some point, it seems like everybody we know threatens to leave Facebook, fed up with the site’s privacy options or its pernicious support of over-sharing. Deep down, we fear that the company has somehow gotten too powerful, and there’s something we don’t like about rich Harvard monopolists. (Remember another Harvard dropout kid who faced the same problems once his company became too powerful?)
And it’s not only individuals who are bellowing about Facebook. Giant companies like GM – a company that spent $10 million on those quirky Facebook social ads last year – are now publicly voicing their discontent with the way Facebook works. Who really clicks on all those ads after all? By calling this out just days before the big Facebook IPO, one gets the impression that the folks at GM either have zero sense of timing, or are clearly miffed at being hoodwinked into spending $10 million on a lot of empty words and Sponsored Stories.
Where is all this schadenfreude coming from?
At some level, we’re all disenchanted that the world’s most successful Internet company is actually just a massive advertising play. Facebook sells ads based on our web behaviors and personal profiles. As a result, the company has every incentive to encourage users to create even more content, so that the ads become even more effective. Not surprisingly, just like GM, we are waking up to the realization that we’ve been used: If you’re not the customer, you’re the product being sold.
If nothing else, this schadenfreude will only deepen as we find out how other Web companies are getting rich by trafficking in our personal data. As we transition to a new mobile, post-PC era, this trend towards personal data consumption by the Internet’s most successful companies will, most likely, only deepen. In fact, our mobile devices are perhaps the perfect devices for capturing information about us – not just online, but also in the physical world. Our phones know where we’ve been, with whom we’ve talked, and where we go online. We all leave a trail of digital exhaust anytime we open up our phones. At some point, we will wake up and realize that all of this digital exhaust is not some new form pollution – it is actually something very valuable that has tangible value in the real world.