Facebook - you are not the customer, you are the product being sold

Facebook has a vision that every single thing you do will be channeled back into a record of your life held by Facebook and shared in real-time with your friends – every web site you visit, every photo you take, every movie you see and song you play and place you go, every interaction with your friends, streamed and viewed and recorded. It’s audacious. It seems science fictional and shocking if you’re over 35. Facebook users will have a record of their life that will be as natural to them as the dusty photo albums of older generations. If Facebook is successful, it will insinuate itself into every corner of the web, transforming the entire online world into something that is inseparable from Facebook. (You’ll find more details everywhere online about the vision laid out at Facebook’s developer conference yesterday. Here’s one article to get you started.)

Look around at the number of web sites with Facebook buttons and Like buttons and realize how far down that road it has gone already. Eight hundred million people have Facebook accounts. Five hundred million visited in a single day recently.

I don’t know who to credit for the cartoon above but it expresses something profound. Step back and reevaluate the online world with that in mind. It may help you understand the motives of many companies, not just Facebook. Next time you visit Facebook – or type a search into that free Google search box – think to yourself:

If you’re not paying for it, you’re not the customer. You’re the product being sold.

Let’s look at it from the other side, courtesy of the New York Times Business section today:

Facebook is not becoming a purveyor of media products, like Apple or Amazon.com. Rather, it is teaming up with companies that distribute music, movies, information and games in positioning itself to become the conduit where news and entertainment is found and consumed. Its new partners include Netflix and Hulu for video, Spotify for music, The Washington Post and Yahoo for news, Ticketmaster for concert tickets and a host of food, travel and consumer brands. . . .

As of May, Americans spent more time with Facebook than with the next four largest Web brands combined, according to Nielsen. Erik Brynjolfsson, a professor of management at the M.I.T. Sloan School of Management, described Facebook as “sort of a walled garden” that, for better or worse, can increasingly filter every other activity on the Internet.

“As Facebook becomes more and more synonymous with the Internet experience, that is going to benefit Facebook shareholders,” Mr. Brynjolfsson said. “Facebook has been very successful in getting the lion’s share of people’s time and attention. Their challenge in the coming years is to convert that dominance in time and attention into a bigger share of consumer wallets — a bigger share of money they spend either directly on Facebook or indirectly through advertising.”