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The new Yahoo? Facebook should heed the lessons of internet history
- JumpCrisscross 8y ago> A senior marketer for a large American bank says Facebook has made mistakes on measuring engagement, reach, views and other data for no fewer than 43 products. All of the mistakes, he notes, worked in the social-networking giant’s favour. “If these were true errors, wouldn’t you expect at least half to benefit marketers?” he asks. He expects to reduce how much his firm spends on Facebook and predicts that other marketers will as well next year. I chuckle at how repeatedly human nature leads to surprise when “our son of a bitch” [1] turns out to be its own son of a bitch. [1] https://en.m.wikipedia.org/wiki/Anastasio_Somoza_Garc%C3%ADa https://en.m.wikipedia.org/wiki/Anastasio_Somoza_Garc%C3%ADa
- colordrops 8y agoThis is like bank errors, which always seem to be in favor of the bank...
- pixl97 8y agoBanks that make errors in customer favor go out of business.
- benj111 8y agoProbably more that people will complain more if the bank error isn't in their favour.
- rmason 8y agoLove how Wells Fargo is running commercials that highlight how great they were after the SF earthquake in 1906. They don't have a single example after 1906 where they did well by their customers? Here in the Midwest they're selling their banks, reducing their geographic footprint.
- celrod 8y agoI found this article fascinating: http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.130.2186&rep=rep1&type=pdf http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.130... The jist is, people are extremely bad at basic logic. Unless it's really in their best interest within the context of the story (ie, catching someone cheating you) to be good at them. It makes the difference between <50% of people getting the question right, vs >90%. Presumably, everyone wants to get these logic puzzles correct. It just so happens that we're conveniently hard-of-reasoning except when it suits us. For reference, the "logic puzzle" is Wason's selection task: which pieces of information do you need to test "if A then B"? The choices (choose exactly as many as needed): (1) A => ?, (2) !A => ?, (3) ? => B, (4) ? => !B?
- ForHackernews 8y agoOne theory is that the brain has evolved specific "modules" that are specialized to certain tasks (i.e. detecting cheaters in social scenarios) and we perform much better when we can rely on these brain-ASICs than when we have to use our general-purpose higher reasoning faculties. As far as I know, there's no conclusive evidence for reasoning modules, but there do seem to be analogous modules in our visual processing system.
- colordrops 8y agoI thought it was pretty well established that humans are wired to recognize faces. I don't have a reference though.
- ForHackernews 8y agoYeah, I think facial recognition, edge-detection, motion tracking, etc. are examples of fairly well-established "modules" of human vision. Unless there's been new research I haven't heard about, it's still an open question of whether there's similar biological specialization for, say, specific logic problems.
- nefitty 8y agoYou can try this logic game here: https://www.philosophyexperiments.com/wason/Default.aspx https://www.philosophyexperiments.com/wason/Default.aspx
- oh-kumudo 8y agoGrowth, Hack
- trasz 8y agoWait, Facebook has over 43 products? What are they?
- danmaz74 8y agoI suspect they were talking about products for marketers.
- usrusr 8y agoFacebook sells ads. Full width banner, half width banner, full width/half width combo pack special promotion, that would already be three different products in that business (these are not Facebook products, just simple examples of what can be called a "product"). On this level, it's easy to get to hundreds of "products" without even trying.
- unrealhoang 8y agoWait, I thought they have 2.3 billions products.
- tim333 8y agoThat said what really counts is ad spend compared with stuff sold as a result, and anecdotally I gather Facebook is quite effective. I mean my friend sold some luxury holidays with quite modest facebook spend and it's rumoured others got a presidency cheap with similar techniques.
- RemarkableMan 8y agoPeople are tired of the Zersetzung.
- ccozan 8y agoThere is obviously in human nature to communicate with others, and share whatever they think is good, while maintaining a certain level of privacy. In real life, this is already happening and it works. However, this must not be captured by an entity who's sole target is profit, neither a state owned entity. Both will hamper the communication at some point, either by manipulating or censoring information. My only hope is that a benevolent AI will coordinate this, having prime directives not to harm humans ( by the means of interfering with the communication ). EDIT: some typos, and also mentioning that the affirmations from above should be read in the perspective of Facebook disappearing/dying and being replaced by something else.
- cyborgx7 8y ago>However, this must not be captured by an entity who's sole target is profit, neither a state owned entity. >My only hope is that a benevolent AI will coordinate this, having prime directives not to harm humans ( by the means of interfering with the communication ). It would have to be some kind of public infrastructure, if you want to avoid the profit motivation. I don't see how an AI would solve this.
- chosenbreed 8y ago> My only hope is that a benevolent AI will coordinate this, having prime directives not to harm humans ( by the means of interfering with the communication ). Mmm...who's going to write that benevolent AI? :)
- kilroy123 8y agoFrom reading some of the stuff Yahoo put out back in their prime. I always got the sense that they thought they would never fall and were maybe a bit invincible. I think Zuckerberg and Facebook in general, are very aware that Facebook is on the decline, they need to diversify. That's why they bought Instagram and used it to flight Snap. That's why they spent such an insane amount on WhatsApp. Zuckerberg knows they need to create or acquire the next big thing to make it in the long term. At least, that's what it seems like to me. I have a feeling they aren't going anywhere soon because of this.
- iamzozo 8y agoSimply, they can't create the next big thing outside of facebook. That's why they bought things.
- philpem 8y agoMaybe they'll become the next Myspace? "Facebook? You still use that? Everyone's on MyFaceWebsiteBookThing now..."
- howard941 8y agoIt's not just Facebook. Perhaps your employer (I know my Fortune 500 is this way) prefers acquisitions over developing new products in-house. From experience I know it saps motivation and good people move on but it seems to be a thing.
- tokai 8y ago>Zuckerberg knows they need to create or acquire the next big thing to make it in the long Isn't that exactly what yahoo did?
- cenal 8y agoThey turned down buying Google. Zuck smartly buys his competitors.
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- iMark 8y agoYahoo failed, in part, because its competitors were better. Being better than Facebook doesn't mean just replicating its technology, it means having a better social graph. That's a hard problem to solve.
- ben_w 8y agoDoesn’t need to be a better graph, it needs to be good enough to grow. Most FB users probably aren’t “power users”.
- StephenMelon 8y agoFacebook jumped the shark when they started trying to encourage private individuals to “create engagement” and pay to boost their posts. If internal marketing jargon is leaking into your UX, you clearly have serious problems with how your staff are being incentivised. Facebook could have become an engine that allowed society to maximise human capital and but they sacrificed all that potential at the altar of growth hacking and bleeding advertisers dry.
- ben_w 8y agoGiven how they started, I don’t think the shark was ever unjumped.
- code_duck 8y agoI remember when that first came out, and was based on how many friends you had. It would have cost me $90 to promote my vacation photos to a group of people semi-randomly selected by Facebook and chance from my friends list, and for people with more ‘friends’, they wanted up to $500, if I recall. Socially, it is extremely out of touch to even offer such a service to individuals.
- johnchristopher 8y agoFacebook users can't boost their own posts, only a Facebook page owner can boost a post made as the page.
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- Lordarminius 8y agoFacebook is dead. It's just taking a long time for this to become apparent.
- King-Aaron 8y agoThere's around 2.23 billion active users you might want to pass that message on to.
- MagnaEterna 8y agoThey are all old. Facebook will probably still be functioning for the next 40 years until it's users finally die and then it's over.
- danso 8y agoSo, basically Facebook still has a lifetime at least an eon long in tech years? The World Wide Web is not even 40 years old yet.
- bennyelv 8y agoBut Instagram users aren't, and there's nothing stopping Facebook from buying whatever the next generation of youth start using to replace Instagram when its time comes. The question is can they make enough cash to make the model perpetual.
- AlexandrB 8y ago> there's nothing stopping Facebook from buying whatever the next generation of youth start using to replace Instagram when its time comes. Hopefully antitrust law will stop them, because with a behemoth like Facebook buying up every new, exciting social network real innovation, especially in monetization, will continue to be a myth.
- King-Aaron 8y agohttps://www.statista.com/statistics/376128/facebook-global-user-age-distribution/ https://www.statista.com/statistics/376128/facebook-global-u... > They are all old. It doesn't appear to strictly be the case.
- TheSpiceIsLife 8y agoBeing compared to the tobacco giants is one of the business world’s more toxic insults, but it is not the only unflattering analogy circulating. A lower blow is the suggestion that Facebook may become like Yahoo, the once high-flying internet firm that plunged. The article is by The Economists, but I tend think the societal costs outweigh the financial to shareholders and employees.
- chewz 8y agoThere is more to analogy with big tobacco. Facebook is used exactly ina way that cigarretes are used. People at work or during commute look at Facebook instead of taking a cigarette break. And then they go back after their business. As more and more democracies realize that Facebook and the likes are toxic for them [1] (democracy is people taking informed decisions not 'engaged' decisions) Facebook will get regulated just as smoking. Which means banned. And people will move on to healthier alternatives. And Zuck will probably end in jail or under heavy litigation for beeing complicit in so many crimes. This is just beggining now. [1] - funny that Russia and China realized what Facebook really is right away years ago and banned it or used to their advantage. But to 'free' countries it is always profit above social consequences. As Lenin remarked - 'Capitalists themselves will sell to us ropes that we will hang them on'
- na85 8y agoThe idea that Zuck will end up in jail is laughable. Laws don't apply to the ultra-wealthy.
- prewett 8y agoThis victim mentality (we are victims of the immune rich) is not helpful to society, especially since it isn't true. Bernie Madoff and the Enron executives absolutely were prosecuted. But you have to actually break the law to go to jail in the US. Being immoral and unethical, being sociopatic and manipulative isn't illegal. Those characteristics aren't limited to rich people, either, they are just the most visible people.
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- sytelus 8y agoIn all likelyhood this is a “submarine” article crafted by a PR firm like Definers for a hit job on Facebook: https://news.ycombinator.com/item?id=18511963 https://news.ycombinator.com/item?id=18511963 There are plenty of short sellers who would benefit from FB’s plummeting stock. In reality, FB’s DAU/MAU are largely unchanged. The stories that young people “deleted Facebook” were downright falsehood. There is simply no viable competition for Facebook in market right now like what Yahoo had in terms of Google.
- JumpCrisscross 8y ago> there are plenty of short sellers who would benefit from FB’s plummeting stock This is a weird meme that’s cropped up in tech circles over the past few years. It’s misleading and incorrect. No short selling fund sells short and then secretly seeds negative PR pieces. If you’re short, your argument is always strengthened by disclosing you put your money behind your words. Short sellers hire private investigators, commission research and occasionally take out ads against companies. They do not put out hit pieces—it is too inefficient and expensive.
- gomox 8y agoHow can you be sure about this? Disclosing the existence of a short makes people doubt the bias in every piece of information you bring up. Keeping a position secret might be more effective than disclosing. I know when I watched that Herbalife documentary I assumed the whole thing was paid for by Ackman and therefore of dubious credibility.
- JumpCrisscross 8y ago> How can you be sure about this? It’s not a hard and fast rule. Just one enforced by economic interests. > when I watched that Herbalife documentary I assumed the whole thing was paid for by Ackman and therefore of dubious credibility You aren’t the target. Current shareholders are. Short-seller messaging is almost always primarily aimed at current long holders. (Since short sellers depend on long holders as a source for borrowed shares, a relationship which isn’t reciprocated in long holders needing short interest to make their investments work, inducing more shorts isn’t a feasible strategy.) The message shows bias from the position, but as an investor, someone betting on their message is more material than the bias. They decided, after all, to bet on the message before they themselves were biased. (When long holders aren’t the target, regulators are. This was the Herbalife strategy. In those cases, too, a broad PR strategy is too expensive relative to the desired results.)
- simonveith1 8y agohttps://www.digistore24.com/redir/85671/SimonV/ https://www.digistore24.com/redir/85671/SimonV/
- rblion 8y agoI've been telling people for years that FB is the next AOL or Yahoo. The writing has been on the wall for most of this decade to be honest. In fact, some of my first posts on HN were about this. I should apply to YC...got nothing to lose, everything to gain.
- fabricexpert 8y agoI know of a few people turning off IG and FB due to the volume of ads, when WhatsApp is monetized lots will do the same. Competitors can offer a similar experience to IG, WA and FB with less ads, because the margins are so massive for FB now, and their products are relatively easily replicated. It's VERY easy for user to switch to a competitor compared with other industries. The scale of the network is hard to achieve but we've seen this done a few times before so I don't see why it won't happen again. I predict that FB will continue to push ads for short term profitability, slowly leak active users and find that a bunch of competitors will beat them by accepting a lower margin than FB are willing to accept. The main hope for FB is that they can identify and acquire these competitors before they get a large enough network to take them out.
- arethuza 8y agoDoes that mean that the valuation of new companies in this space would be reduced once it becomes clear that the whole market is cyclical and by monetizing you start to kill your product?
- ian0 8y agoId say the value of new earlier stage companies in the space will increase given its obvious FB needs to constantly buy new properties to keep the machine running :)
- fabricexpert 8y agoYes, I think that is the case. New social networks add very little value nowadays, which is a long term indicator that the will not continue to grow in value in the way they have so far. Personally I would not invest in the long term with FB.
- typon 8y ago> It's VERY easy for user to switch to a competitor compared with other industries Not FOR WhatsApp it isn't. I don't know of an app that all my family/friends would switch to if WhatsApp decided to put ads on it. Switching chat apps with your entire contacts list is very cumbersome.
- titzer 8y agoPersonally I haven't been able to muster empathy for people who amassed a thousand lifetimes' worth of personal wealth and then are suddenly threatened with the potential of being left with...only a few hundred lifetimes' worth.
- tasuki 8y agoWell, perhaps you'd like to try harder? Or do you think they don't deserve your empathy? In the end, people with infinite money have to deal with many of the same issues we deal with: relationship/personal issues, health problems, death of close ones, etc.
- jedberg 8y agoI don't think you're supposed to empathize with those people. You're supposed to empathize with the people who are about to lose their jobs who aren't wealthy, and the people who currently are comfortable with a bunch of FB stock that may not be worth a lot in the future, making them uncomfortable.
- bunsenhoneydew 8y agoI hope so. I hope FB fades into oblivion too.
- dkrich 8y agoThis seems implausible precisely because it’s the crowded view. But can anyone recall a time that the crowd correctly predicted the ascent of an unpopular product or the descent of a popular one? I’m old enough to remember Yahoo’s rise and fall. There was a time people thought Zuckerberg was a greedy fool for turning down a $1 billion bid from Yahoo. Oh yeah did we forget about that? Yahoo failed because they were out-innovated. They weren’t the only ones. Lots of highly successful search engines got their lunch eaten by Google. Yahoo also suffered from a lack of leadership and some very poorly conceived acquisitions. I don’t see any of that with Facebook. In fact it’s the opposite- people are uneasy with how effectively they’ve acquired users and their data and monetized it. Further, they’ve pretty much only made incredibly savvy acquisitions and managed their integration into the Facebook ecosystem masterfully. Instagram not only exists today but has quickly become arguably the most valuable property. What about Tumblr? Flickr? Say what you will about the ethics of the company but Facebook has demonstrated they have vision and the ability to execute and adapt. Yahoo didn’t. Most companies don’t. They have their existing business and customers and exist as long as the winds don’t change.
- mrtksn 8y ago>This seems implausible precisely because it’s the crowded view I don't think that a company's success is based on the views of the outsiders. This is like picking B instead of C in a multiple choice test because there were to many questions with the answer C.
- nolok 8y ago> Yahoo failed because they were out-innovated The worst part is that Yahoo innovated a lot ... In incubators, side projects, etc ... But they failed to bring their innovations to their main products, or to turn their side things into full blown products. They had no plan, neither overall or per product. Take emails for exemple, for the longest time (and still now, although not as dominating) THE key to user identity on the internet. Google had a plan to leverage their Gmail userbase and integrated it, Microsoft took its time but they ultimately had a plan to leverage their hotmail userbase, but Yahoo sat on yahoo mails (one of the "big three" of emails basically) for the longest time and did ... Nothing. Same with flickr, they had people who loved the platform and begged them to take their money and move the product forward as a paid product and instead they let it rot for years. Lots of yahoo properties are like that. It's not that they tried something crazy and it failed, it's not that they got beat by a new comer, they just let their stuff die on their own. Pictures is now even more relevant than ever, and Yahoo should have been at the forefront and yet they let themselves be sidelined by doing nothing. The best non-yahoo similarity I can find is what Google is doing with Blogger.
- pavlov 8y agoFacebook is not Yahoo — it's much more like Windows. It's ubiquitous, everyone has their pet peeves, and the actual user communities are wildly heterogenous yet tech commentators tend to assume they themselves represent the only kind of user that matters.
- nothis 8y agoWindows doesn’t have true competition. Facebook has. Even if they’re clever and buying lots of it. Still, Instagram has nowhere near the amount of neatly categorized personal data as Facebook which is interesting.
- pavlov 8y ago> Windows doesn’t have true competition. Facebook has. Care to elaborate? I can't think of anyone.
- wild_preference 8y agoThis is usually where someone confirms your original point by saying Mastodon.
- jillesvangurp 8y agoIt's easy to predict that companies will fail, because most do in the end. It's very rare for companies to survive for long periods of time. Just look at the fortune 500 over time. It changes, massively, from decade to decade. If anything that trend is accelerating: companies grow faster and disappear faster as well. So, predicting that neither e.g. Google nor Facebook will be around a decade or two from now is not that unimaginable. Maybe they'll find a way to survive. Maybe they won't. My bet would be Facebook might disappear and Google has more of a chance of diversifying their business enough that they may survive. The reason is that ad driven business models are long term problematic for both but Google at least has alternate revenue streams (e.g. cloud infrastructure revenue, mobile phone revenue, content subscriptions, b2b sales for analytics, development tooling, etc). They have a much more diverse portfolio of products and services than Facebook. And that's discounting the stuff they do under the Alphabet umbrella. Facebook has just ads. Ads on Facebook, Instagram, Whatsapp, .... The odds are stacked against pure ad driven business models. It's a race to the bottom. There's privacy legislation, browsers are being upgraded to counter tracking, and users are slowly getting a clue about it being kind of scary that big companies know a lot of shit about them. Add to that the stream of negative news about them and you are looking at serious challenges to what is the only business model Facebook ever had: create addictive engagement driven properties and claim as much time of their users as possible on it so they can measure what they do and feed them ads, fake news, sponsored content, and other stuff 24x7. Facebook needs to diversify their revenue streams and not just their user facing properties. If they fail to do that, they'll peak and eventually decline. My guess is that the pressure on Mark Zuckerberg to resign will keep on building until he eventually resigns. Then if they fail to change course under a new CEO, they could suffer the exact same fate as Yahoo where shareholders milk the existing business dry and eventually sell whatever remains for scraps. In the case of Yahoo, this only took a decade or so.
- vasilakisfil 8y agoFacebook should have provided a Gmail alternative a long time ago. I am surprised how narrow minded they are in terms of long term revenue.
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- ec109685 8y ago> Facebook could end up paying dearly for mediocre employees to stay on (as its share price falls, it has to hand out more in stock-based compensation to keep people). Does this passage make sense? With a high flying stock, Facebook would be paying more for mediocre employees while the rsu’s vest than if their stock is lower. If Facebook increases rsu’s to even out the employee’s comp, then the net cost to Facebook will be the same at the lower stock price. Their only risk is if Facebook’s stock starts appreciating again and they are on the hook for more rsu’s at the higher price.
- RhodesianHunter 8y agoI think it does, because with many of these companies you're granted X shares vesting over 4 years and if the share price causes you to drop below your total "target comp" they issue you more shares to make up for it, so it's an additional grant out of FBs pocket.
- ec109685 8y agoBut Facebook takes the expense when the rsu’s vest.
- eruci 8y agoFB keeps pestering me with messages about boosting past posts (Unlike before, I rarely post, last one is from a week ago). This pestering has intensified lately. I'm sure this gossip board will one day die, if it not dying already.
- sys_64738 8y agoFB is failing because it’s old now and no hip millennial wants to be seen using the same social media web page as their mom. That’s why FB is falling as he core demographic for nativity that advertisers need to manipulate it has left. All FB needs to do is follow the millennials and buy up the services they decant to.
- malvosenior 8y agoMillennials are 30-40 years old. If FB wants to be hip they need to go after gen z and beyond.
- liftbigweights 8y agoBecause someone writing for the economist would know more about internet history than zuckerburg and the people running facebook. Why is there so many facebook propaganda crap everywhere now? Everyday without fail, you can expect a few here. If we had real journalists in this world rather than propagandists, that would be an interesting investigation and article. Why is the entire media/propaganda apparatus from the nytimes to the economist spanning both sides of the atlantic spamming non-stop propaganda about facebook?
- djohnston 8y agobecause they're being slaughtered by new media like fb and google that takes their ad revenue.
- resters 8y agoIt's remarkable that Sandberg is being thrown under the bus for not doing enough to stop Donald Trump from being elected. What she is (in hindsight) expected to have done is to have insisted that Facebook's news feed algorithm be used as a content filter to suppress stories promoted by politically marginalized groups. This is much the same way China's government uses its Great Firewall to control which information reaches the people. During the civil rights era, the Soviets supported the work of Martin Luther King. In the modern world, Russia supports certain third party views and anti-establishment perspectives, for obvious reasons, just as the US supports pro-Ukraine groups and other fringe political groups that are in close orbit to Russia. So we are being told that Sandberg failed to utilize the firewall capabilities of Facebook to suppress anti-establishment content. We are told this is a big deal because Russia-linked entities spent money to promote some of the ads. Keep in mind the total spend by Russian-linked entities (could be NGOs, private citizens, oligarch-funded research institutes, etc.) was a miniscule $150K in an election with total funding approaching $2B. Yet Sandberg may be relieved of her position because she failed to anticipate how such a small spend could dramatically influence the outcome of the 2016 election. News flash: It didn't. There are a lot of reasons to be concerned about some aspects of Facebook -- my #1 concern is the extensive use of dark patterns designed to make people over-share -- but the "not doing enough" critique is complete bunk. It is 100% motivated by political partisans in the US who unfortunately have a great deal of influence in possible regulation of Facebook and have made it very clear that they plan to use all of their power to force Facebook to act like the well behaved Great Firewall they want. To be very clear, politicians want Facebook to be used at their bidding as a Great Firewall and they very much want to see certain views suppressed and others amplified. They also want to (and already do) use the massive amounts of metadata held by Facebook, Google, etc., to supplement whatever data they have when investigating Americans, who may or may not have committed a crime. It is, essentially, a transparent social credit system for US officials to use at their whim. So the only difference between Facebook as politicians want it to be used and China's Great Firewall is that Facebook exists a bit higher up the protocol stack and its censorship/suppression is much more laser-focused and harder to detect.
- le_clochard 8y ago$85,000 on Facebook ads. Surprisingly small amount, that. https://www.washingtonpost.com/news/politics/wp/2018/05/10/what-data-on-more-than-3500-russian-facebook-ads-reveals-about-the-interference-effort/ https://www.washingtonpost.com/news/politics/wp/2018/05/10/w...
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- lurcio 8y agoArticle is quite wrong: the FB is an ad platform with at least the longevity potential of mainstream TV channel's.
- Animats 8y agoNow ads are around one-fifth of all posts that users see on Instagram, which is probably double what it was a year ago. That's called "pulling a Myspace". Facebook has reached the point that nothing above the fold is about my friends. Remember, sharing is spamming.
- jamisteven 8y agoIm not seeing much correlation between these two companies besides industry. FB is getting bad press sure, but this is nothing like the beginning of Yahoo's downfall, which started with its cluster-F of a homepage and lack of grit or sense of cool in literally any of its products, and ended with super shit management. Yahoo made complicated the tech that needed to be simple. FB has entirely different problems, one could argue they are good problems to have and that bad press is better than no press at all.
- mymythisisthis 8y agoI find it funny how people treat companies. To me the Yellow Pages, Yahoo, and Facebook are all almost the same 'thing' for a lack of a better word.
- akeck 8y agoPlausible or not, it was a little surreal seeing Facebook advertising on television this year. I mean, isn't Facebook, and social media in general, supposed to be "post-television"? ;-)