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Social media: data versus interface

Started by brisbourne · 6 months ago

Yesterday I wrote about ambient intimacy as a first response to Tim O’Reilly’s post about why he loves Twitter.  Today I’m going to tackle his contention that the value of social media sites lies in the data rather than the interface.
He describes it thus%3 ... Continue reading »

7 comments

  • Henry

    7 months ago

    Hi Nic,
    I think the key is having your users use your interface, which is I guess how you get the data. Facebook does not mind people porting their data elsewhere as long as they come back to Facebook and use it as the primary interface for updating their data. Facebook can then control how that data is ported and ultimately monetise it.

    Other people can make money from building stuff on top, but ultimately, if you have the value proposition to ensure that your core base of users always come back to your site, use the interface and update their data, then you are still in control.

    Henry
    reply
  • David Stobs-Stobart

    7 months ago

    Perhaps a comparison to a real world supply chain? Distribution performs a vital role in moving value between the supply and it's demand. And so too in the online world, data and the platform for trafficking that data as a distribution business can be very desirable. But ultimately, it's only one slice of the value chain.

    If any project is done for free for the technical/ social benefit of everyone, that is a laudable thing. Thank you. But for the rest of us that either want or need a commercial model - your post does a great job of highlighting the dangers of starting something without knowing how it's going to pay for itself. Did Twitter have a business model for when they became successful? Did Youtube? Facebook? I bet it was 'eyeballs' for ads (aka data for one specific client - advertisers).

    I think most startups see the benefit of owning the interface and the data. But they rely on the data as a fall back plan for a business model for their great interface ideas, "Somebody will buy all this data!". In the process of generating loads of data, they create goodwill by providing the customer facing interface for free. Does this goodwill protect their data business? Make them more sustainable?

    Perhaps we - as online businesses - can be more creative in finding ways to add value with the interface, and being able to convert that value into something other than goodwill. The interface may be the best and most widely used, but your data trafficking business is under threat when someone else finds a way to get better quality, coverage and faster. We need to be creating and extracting value at each step of the chain. I think there is money left on the table if you're just about the data.
    reply
  • Scott

    7 months ago

    I had a mull over this with respect to Twitter a few weeks on my blog and suggested that Twitter is in a difficult monetisation space as its own share of traffic generated in Twitter (i.e. the amount of traffic through a proprietary interface) is low and falling. If they do nothing about this then they will be forced to monetise through selling access to its API. This seems a "fair" exchange - and arguably the one likely to see the most success - but would certainly redefine the modus operandi in the web 2.0 world of free exchange.
    reply
  • Martin Owen

    7 months ago

    I do not think Xerox made any money out of inventing ethernet (or the modern computer for that matter.

    On the other hand Altavista didn't make Google's money from search tech even when they had near monopoly (even in relative terms of audience)... so there is no sure thing.

    But if you want a good example of sharing sale of data and the best of interfaces, the prize has to go to iTunes. Amazon can beat them (or level them) with a price war. Apple's monopolistic prices have been bad for consumers but good for Apple's medium term profit. I don't see Amazon pulling off the same trick with the Kindle but there may be other vertical systems out there where data, interface and platform form a virtuous circle of great profit. I hope so.
    reply
  • nic

    7 months ago

    Some great comments guys, thank you. I wonder if O'Reilly doesn't really think about money when he assesses technologies.
    reply
  • Henry

    7 months ago

    "Google and Facebook separately announced the general availability of their respective data portability programs on Thursday."
    http://www.pcworld.com/article/154988/
    Looks like Facebook are happy to allow data portability as long as the control it....
    reply
  • PaulSweeney

    6 months ago

    How did online boards make money?
    reply

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