With Zuckerberg’s Shift, Social Media Is Growing Up

– March 7, 2019 Reading Time: 4 minutes

Mark Zuckerberg has made an epic announcement about a dramatic change in Facebook’s focus and business model. In the past, Facebook focused on public sharing of people’s lives and gathering new friends from all over. This view was consistent with the old ethos of social networking: open and public. The money will pour in from selling ad space that directly targets people based on their preferences.

The background assumption here is one many people shared at the dawn of social media: the world is filled with happy people with benevolent intentions. The new digital tools will empower everyone to connect with everyone else, and the world will get ever better. What could go wrong?

Then some strange things began to happen. People we thought were friends were not. We friended people who turned out to be sketchy. Trolls gathered and multiplied. Friend groups became confusing. People were losing jobs based on imprudent sharing. Fake news distorted information flows. Doxing, spying, harassment, fake names, and other terrible things began to wreck the original vision. Other things I won’t mention.

In the course of a few years, the safe, happy, open space gradually turned dark, strange, mean, menacing. Just keeping out the trolls and protecting one’s data became more and more troublesome. Then the panic set in. What exactly is Facebook doing with all this free content I’m giving to the platform? How did my private information become commodified?

The ethos of social media began to change. Users started gravitating to platforms that emphasized privacy and security. A market opportunity opened for all sorts of encrypted platforms that don’t retain your data, including WhatsApp, Telegram, Signal, and Discord. They evolved to become their own social communities. Snapchat made a mint from a trick that makes your pics and texts disappear soon after they are sent.

It’s too little, too late, but Facebook has now promised to adapt. Open and public? Forget it. Smaller groups, closed, and private is the new way. One could discern the palpable sense of relief upon the announcement. Clearly, consumer preferences have changed. Facebook lives within a dynamic market setting. It is adapting to keep up.

I welcome the change, of course, but, like you, I wonder if it is sincere. There are some warning signs that it won’t go far enough: for example, the idea of combining contacts across all Facebook-owned platforms (Instagram, WhatsApp, Messenger) seems unwise. There is also the problem of the business model. The revenue stream right now depends on the public platform.

Still, what strikes me as interesting is the very existence of this pivot.

National Facebook

Think about the following. What if Facebook had been nationalized as a public utility back when the entire political class was pushing for that? Remember that? It was not too long ago. Zuckerberg was being grilled by the political class in Washington. Columnists had decided that the company had utterly failed to manage itself, and therefore its operations had to be turned over to the regulatory state.

What if they had succeeded and Facebook came to be managed like a public utility? It is impossible to think of any change of the sort just announced would ever have taken place. It would have been frozen in place except with more rules imposed by regulatory edict. It would eventually have become like the post office, a service everyone knows is deprecated but one that will last forever simply because the interest groups keeping it alive are more powerful than the broad interests of the public.

Here we see the great merit of the market economy in operation. The point is not to create perfect products and services or idealized businesses. The point is to raise up institutions that adapt to change in response to the forward direction of progress in the world: resources, technologies, consumer needs, stockholders, and so on. The market provides a method not for the creation of finally perfect things but for fixing errors as they are revealed in the course of time.

In the end, consumers have the power. That is the source of the inspiration for change.

What is the error that is being fixed right now in social media? Let’s return to that underlying presumption that the world is filled with happy, benevolent people who are looking for connection to others. Let’s say that is true 97 percent of the time; the remaining 3 percent can create a huge amount of chaos for everyone else. The challenge of legacy social media platforms has been to find that 3 percent and exclude them so that the venue itself is not wrecked.

New platforms have started with a different presumption: that there are bad actors out there and we all want to stay away from them. If you think about your own life, you work for a large part of it to curate your friend groups and associates to be with people you trust not to be evil. You develop formal and informal rules about your engagements that make this possible. The newer platforms figured this out. They learned how to infuse the anarchy of digital connection with the rules we develop and apply in the regular course of our lives.

Will Facebook save itself in time? That’s a great question. Regardless of the answer, what’s most impressive is that the institution is making an attempt, not because the company necessarily wants to but because it has to in order to survive in a highly competitive environment.