Day: January 15, 2017

The Next Big Thing: The Old Model Becomes The New

First let me start as to supply a little context…

If there’s been one thing that surely meets the definition of “it’s different this time, it is this:

When it comes to business models: If it’s delivered via the “everything social” model – free is not only the starting price for most products or services, it may also be – the only price.

I believe and propose this model; the one that empowered most everything consumed today on the internet via the “everything social” model, is not only about to change; some of the largest purveyors of this model will be crushed into irrelevancy, if not outright oblivion in the not so distant future. So as not to be mincing my words, or accused of being coy, here’s precisely what I’m arguing:

The “everything social model” currently coveted by Silicon Valley and others; and responsible for the likes of Facebook™, Twitter™, et al is in the beginning stages of imploding upon itself.

Big call? Yes. Some will even state (in particular “The Valley” itself) I don’t know what I’m talking about, and even more will say “impossible.” Especially with the likes of Facebook (FB) once again soaring towards the stratosphere. (I’ll argue that’s just an exposure rotation before earnings) However, that’s what I see coming over the horizon in the not so distant future. Here’s my reasoning…

Think what you want about “fake news” and its impact via media reports. What can not be denied is this: Social media (and some media in general) has taken up digital arms as to protest, slur, slander, name call, dehumanize, threaten, and more what can only be interpreted as half the U.S. population.

In other words: If you supported/support the president-elect, or have a differing viewpoint than the now “enraged snowflake culture” in any way, shape, manner, or form? You are now deemed an enemy and will be persecuted by any means possible via social media. This punishment might also be administered via the companies themselves whether it be some form of outright takedown, “denial of service”, or some variation such as simply not allowing content to reach an intended or, even paid-for audience. (see Crowder vs FB for more insight)

And therein lies “the devil in the details” that so many, I believe, are glossing over. For that little detail (e.g., the possibility of dejecting 50% of current users) is the “Achilles heel” of all current, as well as future valuations for the “everything social” model. Disrupt that one metric? And Silicon Valley as it’s now viewed – is gone. Period. Or said differently – “1999 is here – and wants its socket puppet back.”

When it comes to business, one thing is beyond dispute: You can’t insult, or denigrate 50% of the U.S. population which may be consuming your product or service on a consistent basis, and expect them to continue using your product or service. That goes for social media, Hollywood actors/actresses, comedians, rock stars _______ (fill in the blank).

You may remain “relevant” within certain circles, but that’s where you’ll remain. e.g., In certain circles. Not the broader audience that many of these types so vilely crave for.

I make this point not so much for the “tables turning” argument per se. What appears to be more the case is that people are getting up from these “tables” and walking out. And just like many a comedian, or aging diva were outright booed and patrons left when they began their political diatribes from the stage. So too must it be happening on these social platforms. Although the results might not show their full impact until after this current earnings quarter if I’m correct, since this current will encompass the remainder of the election cycle when both sides were heavily engaged.

But as far as the going forward? Let’s just say I’m arguing, “It’s different this time” shall we?

So here’s why I wanted to state the above for context: If I’m correct – priced for perfection metrics (which I believe all these platforms are, and then some) can’t sustain current valuations and will begin imploding upon themselves reminiscent of AOL™.

If that’s the case? So too does the “everything free” model leaving behind the only thing worth purchasing: What’s left in the remnants of technology, patents, or other forms of these companies to be bought up at bargain prices (more like fire sale) and either utilized solely, or licensed out in parts, to then be used, or offered, in subscription based, or advertiser friendly exclusionary based service models. Let me explain it using a hypothetical scenario…

What would be worth more value to both users as well as advertisers?

  1. A platform which allows you plug-ins, or extensions that had the same functionality for all intents and purposes as Twitter, FB, that you controlled with no outside interference, no outside censorship, and is controlled by you, and only you, with no outside worries about whether your content would, or would not, be removed by any outside party? Or…
  2. A platform that basically doesn’t allow you any customizable ability and is self designated itself as an outside overlord that will dictate what can, or may be seen by your customers/audience whether you agree or not?

The first is the tried and true basis of the internet: A website, email, self video or audio hosting, and the allowing (or not) of comments for immediate interactions with users or clients, all accountable to one’s own purview.

The second is Facebook, Twitter, YouTube™ et al.

Remember, this question is for those which pay for – not those consuming for free. A distinction with a very real difference.

I am further implying that those “plug-ins” of the future will be FB-like or Twitter-like extensions in the not so distant future available much in the same way as corporate-email or other proprietary services are now available for purchase to business or content providers, not stand alone companies as they are today. (I can hear the gasps coming through my screens as I type.)

If you’re a business, and you’ve watched with a careful eye what these platforms are doing for (if not too) businesses? I would implore you to rethink your “web presence” and how it currently interacts, if not unknowingly depends, on the “everything social” model for interactions with your customers or brand. For not only is it self-evident you are no longer in control of your message – you might just find your “messaging” in streams or data feeds you never dreamed possible. Here are a few to think about:

For “free” you can view live streaming on FB. Yet, of course this “free” service to end users will at some point be needed to be “paid for” by advertisers. Test live ad insertions are already in the process of being rolled out. And here’s some of the feeds you just might find your brand associated with: “Torture video of disabled man live streamed…” Or: “Girl, 12, livestreams her own suicide…” Or: “Heartbroken man commits suicide live on …” Or: “Woman Facebook live-streams her dying boyfriend…” Those are just the latest in the last 90 days or so. (I didn’t link because the partial headlines say all one needs to know)

If you think advertisers have no reason for concern? Then here’s a link to prove that assumption dead wrong. For the following was happening smack dab in the middle as those above horrific scenarios were playing out live. To wit:

“Facebook Launches a Big Ad Campaign for Facebook Live, With User Videos at the Core”

But not too worry, FB and other providers will always make sure it’s not your ad that’s inserted at the wrong time, right? Oh yeah. and just for those who say: “If they find out they’ll have to take it down immediately!” Lest you be reminded of the following given by a spokesperson for FB in reply to calls of just that from The Guardian™. To wit:

“We do not allow people to celebrate or glorify crimes on Facebook and have removed the original video for this reason. In many instances, though, when people share this type of content, they are doing so to condemn violence or raise awareness about it. In that case, the video would be allowed.”

Now if you’re worried about you ads or service being promoted in the wrong video at precisely the worst time? Maybe you’ll feel better knowing the years you spent cultivating an audience on another “free” platform will infact do the exact opposite and just remove you, and your content all together, without any regard of how it might impact you, or your business. Again, to wit:

YouTube’s without warning termination of the political and law website belonging to Legal Insurrection™.

8 years of content and customer cultivation “poof” as in gone with no regard to how it impacts the provider. Again, this isn’t like they just began throwing content up and were discovered. This is after 8 years!

Personally I’ve had my own run-ins with such early on, and is one of the main reasons for years why I’ve argued (and still do) against building any portion of one’s business reliant on these “free” models. (Personally I use none, both business or socially) And those reasons are coming to fruition and bearing “sour fruit” with an ever-increasing and steady pace. And, in my opinion, it’s just getting started yet, quickly building momentum.

If you want an example of just how inept these platforms are when it comes to being able to make sure the “right things” happen for advertisers whether it be for ads to be placed in the right places, or content not taken down arbitrarily with an almost unforgiving, if not unreachable staff as to fix, or alleviate concerns. (i.e., Trying to reach a person on these platforms is near, if not impossible in any meaningful way) Look no further than the most recent, outright laughable, public debacle of Twitter founder and CEO Jack Dorsey getting his own user feed suspended from the platform he’s in charge of for “rules violation.”

And these are the people supposedly writing the rules for others to follow, yet, either can’t, or won’t follow their own rules to begin with? Or worse – don’t even know them!

(Remember when FB called in all those “conservative” content providers to make sure “they got things right” when calls of “censorship” were being bandied about and FB at first denied even the possibility of it, then gave a contorted apology for it, then stated they were putting in steps to fix the steps that were supposedly not happening (for it was supposedly algorithms were the sole culprit, only to find out later there were actual people involved), then culminating with a meeting where Mark Zuckerberg gave assurances himself with everyone proclaiming “He really cares!” How’s all that looking in today’s light? You know, since he’s openly since proclaimed a reverse of all of that going forward. But I digress.)

Again: And they’re the one’s controlling your brand, your messaging, your audience, and want you (as an advertiser) to pay up for more of this?

Re-read that last line and think it through a few times if you’re a business or brand? Do you feel more “confident” in those platforms today with what you now know, and have witnessed over the last few months? Or? (I’ll just pause here and let you think on your own.)

So, if the above has any merit (and I believe it has) than the question is:

How many current content providers jettison social media and take their “deplorable” users along with them reverting back to using what was once a tried and true business practice and model (i.e., owning your platform or content such as website, email, and other peripherals – with complete utter refusal to give it away for others to decide) And leaves the “free” loaders to view the mountainous remaining cat videos, or latest Kardashian escapades for themselves?

And if “user growth” metrics begin reversing on these priced-for-perfection platforms? The money (as in stock valuation) goes out the door with them.

If you want to see just how quickly this can all happen – need I remind you of LinkedIn™?

That was another “business model” I was told I hadn’t a clue about. That is – until it too went the way of needing to be “bought out” to save it. And just for curiosity…

When was the last time you heard, or were spoken too, about the “dominance” or “relevancy” of LinkedIn?

(Insert crickets here)

If you’re a business, the writing for how one should realign one’s business when it comes to the internet is right there for all to see. Control your content and customer interface – or – have your customers, as well as company, controlled by others.

In business – there’s only one choice. So choose wisely.

© 2017 Mark St.Cyr