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I agree to breaking up Facebook. But the message falls flat when the suggestion is to spin off WhatsApp and Instagram into separate companies. This doesn't real

by anonu 8y ago

I agree to breaking up Facebook. But the message falls flat when the suggestion is to spin off WhatsApp and Instagram into separate companies. This doesn't really do anything. When standard oil or Bell telephone broke up, they were broken across geographic lines or "horizontally" in situations where the business was vertically integrated (separating extraction, refining or transport in the case of standard oil) FB, IG and WhatsApp are all separate companies with arguably very different business models, so separating them up has little impact.

nkozyra 8y ago
How are the business models different?
- cameronbrown 8y ago
  FB, IG and WhatsApp are isolated silos (for now). FB tries to work for everyone whereas IG and WhatsApp target younger demographics, since Facebook is no longer cool to be on.
  - deleted 8y ago
    [deleted]
  - johnday 8y ago
    WhatsApp certainly does not target younger demographics. Its goal is to be a messenger app for everybody.
    - cameronbrown 8y ago
      Isn't that what Facebook Messenger is doing though? I could be mistaken, I'm just commenting on how it seems from my perspective.
      - johnday 8y ago
        To some extent, yes. Facebook Messenger is very effective for communicating with people - so long as they're on Facebook. So it's a good way of keeping people in the system. I probably would have deactivated my account were it not for Messenger. But WhatsApp is capable of including everyone regardless of whether they're on Facebook. As the pool of "I'm too cool for Facebook" people grows, more communities will move away from Messenger and WhatsApp is a good secondary as far as FB is concerned.
  - nkozyra 8y ago
    But that doesn't address the business model.
istjohn 8y ago
I disagree. Many people have moved away from FB to IG after all the bad publicity FB has had. If IG was an independent company that consumer choice would mean something. As it is, any privacy conscious social network that mounts any threat to FB will simply be bought as happened with WhatsApp.
- rock_hard 8y ago
  Can you cite source for the claim that people have switched? Cause all I see is people using both...and the publicly available data supports that
- basch 8y ago
  IG was like a 13 person company, do you think they would have successfully scaled without FB? Thats a pretty pretty big if. Had they not sold, its possible FB would have just murdered them.
  - reanimated 7y ago
    Before being acquired by Facebook they already had over 30 million users
ardy42 8y ago
> I agree to breaking up Facebook. But the message falls flat when the suggestion is to spin off WhatsApp and Instagram into separate companies. This doesn't really do anything. It does, because Facebook protects its monopoly by making sure it owns its competition. Instagram, WhatsApp, and Snapchat are its competition, and the first to are far larger than the last. Bell telephone was broken up geographically for technical and infrastructural reasons (too expensive to build duplicative) telephone exchanges, I'd imagine), and I'd argue it was a poor example since it left regional monopolies.
jmastrangelo 8y ago
I agree with your premise that breaking up FB, WA and IG doesn't really do anything (I made a much longer comment about this in a reply above). But what would breaking up facebook even mean then? Fundamentally there's no equivalent to the geographic breakup, as physical natural monopolies emerge because you can only have one company per unit of natural resource. Facebook is a monopoly because of network effects, and by definition only a company as large as facebook can compete with facebook, and a facebook with only a subset of your friends becomes nearly useless. If facebook has bad behaviour, I think regulation is the only actual solution that actually addresses that behaviour, and makes any sense given the market dynamics.
- basch 8y ago
  Its absolutely possible to break facebook up horizontally. And if the government were to explore a breakup, its the way they should go. Company 1 would be a Social Networking and Hosting PaaS from hardware, networking, bandwidth, databases, serverless workers to services like ads, anti-evil, localization, social graph, development tools, frameworks, runtimes. Company 1, would be THE place to build a social network, if you were an upstart. Company 1 could instantly be a tier 1 competitor to AWS and Azure. Imagine being able to tap into Facebooks Identity services, but running your own Directory Tenant, instead of tied to the FBID. Company 1 would compete with Firebase and restart Pulse, it would jump headfirst against Microsoft and its Visual Studio/GitHub offerings. Company 2 become clients, consumers, of Company 1 services. They include Messenger, WhatsApp, FB, IG, and Occulus. The other beauty of a horizontal breakup is that Company 1 lowers the barrier to entry for new upcoming social networks, without being a risk to them being eaten by Company 2. Mark then also can profit off selling his competitors service, similar to AWS profiting off Netflix.
  - jmastrangelo 8y ago
    I think the idea of your "company 1" is actually super interesting, essentially social Graph as a Service(GAAS?). But , I don't think that addresses any of the issues people actually have with facebook. What does facebook running both the front and backend of their site have to do with their market power? That company 1 would still retain 90% of Facebooks value, as it would be the social graph where people acknowledge their real life connections. It would still have all the privacy liabilities, in fact Facebook's largest scandal (Cambridge Analytics) was due to the face they were too open with the social graph! And that it was misused! If we're selling the social graph now can't there be a million politically oriented "research operations" that spring up and use it? Also, FB, IG and WA all have separate social graphs, them being frontend skins on one service doesn't reflect that. So they'd likely be completely separate companies full stop, maybe using a couple services from GAAS like spam algos. Sure new, potentially better frontends for FB could pop up with more specialized niches, but facebook is already exploring that with messenger and events getting their own apps and sites.
TheRealDunkirk 8y ago
I note that all the mini-Bell's have now merged and reformulated into just 3 companies, and $10 says AT&T or Verizon will gooble up CenturyLink before long: https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System. I like Elizabeth Warren's idea (in the case of Google) to break up the sales side from the platform side, and let them compete like everyone else for advertising impressions in the exchange. I admit I may not understand the nuance here, but the idea is readily grasped, which is, perhaps, the most-important thing in getting political leverage behind it.
- basch 8y ago
  Not just merged into 3, but also eaten all the other independent competition that old ATT would have had. GTE was huge and not a Bell (largest independent ATT competitor). Their cellular network was originally half Vodafone. They bought MCI/Worldcom (largest long distance provider after ATT at one point.) Look at CenturyLink/Qwest/Layer3/Embarq(Sprint)
basch 8y ago
I 100% agree with you that the idea of spin-offs is flat, tone deaf, and all about PR for the proposers, and not anything actually beneficial to the public. Wrote more about what I think is better replying to a child comment of yours. https://news.ycombinator.com/item?id=19868464 https://news.ycombinator.com/item?id=19868464

by anonu 8y ago

nkozyra 8y ago

How are the business models different?

cameronbrown 8y ago
FB, IG and WhatsApp are isolated silos (for now). FB tries to work for everyone whereas IG and WhatsApp target younger demographics, since Facebook is no longer cool to be on.
- deleted 8y ago
  [deleted]
- johnday 8y ago
  WhatsApp certainly does not target younger demographics. Its goal is to be a messenger app for everybody.
  - cameronbrown 8y ago
    Isn't that what Facebook Messenger is doing though? I could be mistaken, I'm just commenting on how it seems from my perspective.
    - johnday 8y ago
      To some extent, yes. Facebook Messenger is very effective for communicating with people - so long as they're on Facebook. So it's a good way of keeping people in the system. I probably would have deactivated my account were it not for Messenger. But WhatsApp is capable of including everyone regardless of whether they're on Facebook. As the pool of "I'm too cool for Facebook" people grows, more communities will move away from Messenger and WhatsApp is a good secondary as far as FB is concerned.
- nkozyra 8y ago
  But that doesn't address the business model.

istjohn 8y ago

I disagree. Many people have moved away from FB to IG after all the bad publicity FB has had. If IG was an independent company that consumer choice would mean something. As it is, any privacy conscious social network that mounts any threat to FB will simply be bought as happened with WhatsApp.

rock_hard 8y ago
Can you cite source for the claim that people have switched? Cause all I see is people using both...and the publicly available data supports that
basch 8y ago
IG was like a 13 person company, do you think they would have successfully scaled without FB? Thats a pretty pretty big if. Had they not sold, its possible FB would have just murdered them.
- reanimated 7y ago
  Before being acquired by Facebook they already had over 30 million users

ardy42 8y ago

> I agree to breaking up Facebook. But the message falls flat when the suggestion is to spin off WhatsApp and Instagram into separate companies. This doesn't really do anything. It does, because Facebook protects its monopoly by making sure it owns its competition. Instagram, WhatsApp, and Snapchat are its competition, and the first to are far larger than the last. Bell telephone was broken up geographically for technical and infrastructural reasons (too expensive to build duplicative) telephone exchanges, I'd imagine), and I'd argue it was a poor example since it left regional monopolies.

jmastrangelo 8y ago

I agree with your premise that breaking up FB, WA and IG doesn't really do anything (I made a much longer comment about this in a reply above). But what would breaking up facebook even mean then? Fundamentally there's no equivalent to the geographic breakup, as physical natural monopolies emerge because you can only have one company per unit of natural resource. Facebook is a monopoly because of network effects, and by definition only a company as large as facebook can compete with facebook, and a facebook with only a subset of your friends becomes nearly useless. If facebook has bad behaviour, I think regulation is the only actual solution that actually addresses that behaviour, and makes any sense given the market dynamics.

basch 8y ago
Its absolutely possible to break facebook up horizontally. And if the government were to explore a breakup, its the way they should go. Company 1 would be a Social Networking and Hosting PaaS from hardware, networking, bandwidth, databases, serverless workers to services like ads, anti-evil, localization, social graph, development tools, frameworks, runtimes. Company 1, would be THE place to build a social network, if you were an upstart. Company 1 could instantly be a tier 1 competitor to AWS and Azure. Imagine being able to tap into Facebooks Identity services, but running your own Directory Tenant, instead of tied to the FBID. Company 1 would compete with Firebase and restart Pulse, it would jump headfirst against Microsoft and its Visual Studio/GitHub offerings. Company 2 become clients, consumers, of Company 1 services. They include Messenger, WhatsApp, FB, IG, and Occulus. The other beauty of a horizontal breakup is that Company 1 lowers the barrier to entry for new upcoming social networks, without being a risk to them being eaten by Company 2. Mark then also can profit off selling his competitors service, similar to AWS profiting off Netflix.
- jmastrangelo 8y ago
  I think the idea of your "company 1" is actually super interesting, essentially social Graph as a Service(GAAS?). But , I don't think that addresses any of the issues people actually have with facebook. What does facebook running both the front and backend of their site have to do with their market power? That company 1 would still retain 90% of Facebooks value, as it would be the social graph where people acknowledge their real life connections. It would still have all the privacy liabilities, in fact Facebook's largest scandal (Cambridge Analytics) was due to the face they were too open with the social graph! And that it was misused! If we're selling the social graph now can't there be a million politically oriented "research operations" that spring up and use it? Also, FB, IG and WA all have separate social graphs, them being frontend skins on one service doesn't reflect that. So they'd likely be completely separate companies full stop, maybe using a couple services from GAAS like spam algos. Sure new, potentially better frontends for FB could pop up with more specialized niches, but facebook is already exploring that with messenger and events getting their own apps and sites.

TheRealDunkirk 8y ago

I note that all the mini-Bell's have now merged and reformulated into just 3 companies, and $10 says AT&T or Verizon will gooble up CenturyLink before long: https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System. I like Elizabeth Warren's idea (in the case of Google) to break up the sales side from the platform side, and let them compete like everyone else for advertising impressions in the exchange. I admit I may not understand the nuance here, but the idea is readily grasped, which is, perhaps, the most-important thing in getting political leverage behind it.

basch 8y ago
Not just merged into 3, but also eaten all the other independent competition that old ATT would have had. GTE was huge and not a Bell (largest independent ATT competitor). Their cellular network was originally half Vodafone. They bought MCI/Worldcom (largest long distance provider after ATT at one point.) Look at CenturyLink/Qwest/Layer3/Embarq(Sprint)

basch 8y ago

I 100% agree with you that the idea of spin-offs is flat, tone deaf, and all about PR for the proposers, and not anything actually beneficial to the public. Wrote more about what I think is better replying to a child comment of yours. https://news.ycombinator.com/item?id=19868464 https://news.ycombinator.com/item?id=19868464