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Mark Cuban: Facebook Is Driving Away Brands - Starting With Mine

• mvkel 14y ago
  Know what drives away consumers, Mr. Cuban? Awkwardly obvious product placement: http://www.youtube.com/watch?v=HEBtJqze0rE&t=8s http://www.youtube.com/watch?v=HEBtJqze0rE&t=8s
  • zalew 14y ago
    yeah, that plugs in shark tank are ridiculous to the point of absurdity.
  • ckluis 14y ago
    My wife now watches Shark Tank with me and is becoming rather shrewd in evaluating businesses. We both hate the product placements. Speaking of business model that drives away customers. Did you know you give up 5% of your business to appear on shark tank because of the exposure? With or without the deal. That is why they do the follow-ups on companies that did or did not accept a deal. It's good for the shows owners.
    • Evbn 14y ago
      Did you know that YC takes 7% of your business, whether or not you get funded a demo day? Shark Tank may be a better deal. Or not. But it is ridiculous to argue that based on the fee for a prime time infomercial.
      • mvkel 14y ago
        7%, seriously? I had no idea. Why are people clamoring to get accepted by YC? I'd be doing everything I could to make it a last resort, not a means to succeed.
        • tlianza 14y ago
          Because owning 93% of a company that's even 2x more successful than it'd otherwise be is still a good deal for you.
        • pja 14y ago
          Well, apart having personal advice on tap from a range of experts, the fact that on demo day your idea will be in front of the best VC groups in SV, access to YC alumni for help and advice, I can't imagine why people would give up 7% of their nascent startup either! (this is sarcasm btw.) More seriously: you're giving up 6-7% of your company in return for a whole swathe of things that are very likely to increase your chances of succeeding significantly. Most people don't have ready access to the kind of personal networks that YC offers: the combination of that access, plus the social proof of having the YC imprinteur massively increases the likelihood of success for many, many startups. And I'm saying this as someone who's very unlikely to ever apply to YC, but even I can see the benefits in applying, as do many others who choose to go to YC even if they don't in fact need the money: the fringe benefits are worth far, far more than the cash.
      • hoka 14y ago
        His comment wasn't argumentative or anti-Shark Tank. The owners are well aware of both situations, and it's their right to make the choice. For some businesses, that 5% is well worth the prime time informercial. And I imagine everyone who's received a YC offer has accepted as well.
        • ckluis 14y ago
          True - I didn't argue it wasn't worth it. I just stated that they do it.
    • lusr 14y ago
      I've commented about the Shark Tank 5% before [1]; I believe it's quite reasonable, why don't you? Have you seen Dragon's Den (UK)? I saw Shark Tank first and thought it was great but the more hardline Dragon's Den grew on me and I believe I learned much more from it. [1] http://news.ycombinator.com/item?id=3948913 http://news.ycombinator.com/item?id=3948913
      • ckluis 14y ago
        Oh hell yeah. I'd give up 5% for the exposure (under the right circumstances and with the right business/product) the marketing alone is worth it. I think this process skews the risk/reward relationship found in typical investments because the companies they invest in get 3-10 minutes of advertising. I'm sometimes surprised they don't do more deals at lower valuations on that alone.
    • jamesbritt 14y ago
      Wow. I've watched the show with my wife and had been assuming that no one should take a deal they weren't really happy with. Better to walk out with no deal because even then you've gotten free advice from some shrewd, experienced people. But free ain't free, it seems.
  • nsxwolf 14y ago
    I enjoyed reading your comment on my T-Mobile® device.
  • bluetidepro 14y ago
    I'm so glad other people noticed this. They did it quite a few times in recent episodes with the T-Mobile phone. Another episode it was used was when Robert Herjavec visited a past invested project (where they show the "how they are doing now" segment) and they exchanged a document by holding the two T-Mobile phones back to back, and then proceeded to say some cheesy line. I typically love the show, Shark Tank, but the recent blatant product placement is starting to rub me the wrong way about the shows integrity, and the people coming on the shows. Also, slightly more off-topic, but is anyone else annoyed with the recent emotional break-downs on the show that, in a few cases, led to getting investments over the person awkwardly crying and/or having a break-down? It was also more obvious it was only cause of the break-down (it seemed) because on one of the instances everyone was "Out", but then a "Shark" came back in after the break-down. It's starting to feel too much like a reality show to me, as of this season. Which disappoints me, because the show used to be one of my favorites.
    • mvkel 14y ago
      It _is_ a reality show. The decisions are made before the person ever gives their first on-camera pitch.
      • bluetidepro 14y ago
        That is actually not true, according to a past contestant: https://www.quora.com/Shark-Tank-TV-series/What-is-Shark-Tank-like-off-camera-and-pre-post-show https://www.quora.com/Shark-Tank-TV-series/What-is-Shark-Tan... Quotes from the first-hand account of a Shark Tank contestant: > "I was strictly forbidden to have any contact with the Sharks before taping. I had never even seen any of them in the flesh until I walked out onto the soundstage and the cameras were rolling. " > "The Sharks also have absolutely no idea what is going happen with each company that comes on, they haven't even seen the pre-roll that the audience sees (where the camera follows the contestant around their home town, etc)."
        • mvkel 14y ago
          I don't see how those statements invalidate my claim.
  • lusr 14y ago
    I had no clue who he was before watching Shark Tank. But it greatly impressed me when he straight-up called the woowoo "ions" guy on his bullshit and outright called it a scam [1]. Watching the YouTube video you linked it doesn't look like he seems to enjoy the T-Mobile product placement. Have I been brainwashed into liking him because of my earlier experience? [1] http://www.youtube.com/watch?v=4XfXt93s1YE http://www.youtube.com/watch?v=4XfXt93s1YE
• grimey27 14y ago
  He's not doing anything other businesses haven't considered. I'm sure he'll go back.
• Evbn 14y ago
  Maybe when the "brands" are gone, Facebook will stop driving away users.
• deleted 14y ago
  [deleted]
• bmac27 14y ago
  I don't know the FB advertising system inside & out either but like Cuban, I'm miffed by this. The implication here is that companies essentially don't own their own "likes." What value do they have outside of being a vanity metric if you can't reach them aside from coughing up thousands of extra dollars?
  • glesica 14y ago
    They don't own their "Likes"! Has that ever, even for one single moment, really been in doubt? Facebook owns the platform. You play in their sandbox, you follow their rules. They own all the toys. Look at Twitter locking down their API or Apple inconsistently enforcing arcane app store rules. When someone else owns the platform, they effectively own anything you create with it.
    • tjculbertson 14y ago
      You nailed it. Lots of great arguments for both sides, but FB owns the platform and all the toys. All big brands know the risks of making big bets to sell stuff in another guy's yard. In a free market FB can move the goalposts all they want,but the reach is still worth the risk until the cost of doing business with them makes the roi equal to or less than other big reach platforms.
• antonioevans 14y ago
  As with all new ad platforms you have to test the ROI. Apparently in his businesses he didn't see the benefit and did what all good marketers would do, pull your inventory. As Facebook tweaks it's EdgeRank Algo I am sure they will figure out how to get the most "bang for the buck". If not their stock price will continue it's slide.
• neutronicus 14y ago
  One could interpret this as Facebook being a "victim" of their own success - they have so much demand for advertising that they have to limit access to their userbase in order to ensure that the advertising retains its value. Perhaps, as Cuban says, uninformed business owners think they're paying for something other than what they're getting and demand will dry up once advertisers get wise. Or perhaps Facebook's conversion rate is just that good.
  • executive 14y ago
    More like so little demand for advertising. FB has a massive supply of impressions which has bottomed-out remnant/auction CPM rates industry wide. I see this as a move to try and introduce a (somewhat) premium ad product. Users have already indicated interest in the brand -- now they will have to pay to reach these intenders.
• jivatmanx 14y ago
  Mark Cuban is a primary investor in the patent troll Vringo. Why are we pretending he's some kind of tech trendsetter?
  • jasonkolb 14y ago
    Just because you don't like one of his companies doesn't mean he's not a very smart businessman.
  • waterside81 14y ago
    Which is odd, because he's been quite vocal in his opposition to software patents.
  • s_henry_paulson 14y ago
    He's not pretending to be a tech trendsetter, he's being an investor, and hedging his bets, as all good investors do This is a hedge against the unlimited patent exposure all the companies I have investments in face. Patent risk is impossible to quantify. It's unrealistic for most small to medium businesses to have any clue which patents they are at risk over. Vringo's IP from the merger is the flip side of that risk and offers an imperfect hedge. So, I made the investment. http://www.forbes.com/sites/ericsavitz/2012/04/17/cuban-says-vringo-stake-hedges-patent-risk-in-other-investments/2/ http://www.forbes.com/sites/ericsavitz/2012/04/17/cuban-says...
• jasonkolb 14y ago
  He has a great point. It takes resources to build up an audience anywhere, and then the assumption is generally that once you have that audience you've gained the right to speak to it. Facebook expects you to pay to build your audience (via ads) and then again to speak to it (via "reach"). This makes it a pretty bad idea to spend resources on building an audience there. Will Twitter do something like this? I don't think so. But it's also a crapshoot whether your tweet will actually be seen or too far down your tweet stream for someone to actually see it. I still believe that email marketing is The. Best. place to build an audience because you have permission to send a message to someone that is almost guaranteed to at least have its headline read. Of course the rules of the road apply wherever you build an audience, meaning you can't spam or abuse the privilege to talk to them. But all things being equal, owning the channel has some HUGE advantages.
  • oddthink 14y ago
    It did sound a lot like he was assuming Facebook would act just like email, at which point you have to wonder why not collect email addresses. As an infrequent and naive Facebook user, I would not expect that "Liking" a company page meant "Subscribe me to whatever they want to send me."
  • matznerd 14y ago
    The power of owning the channel is a huge advantage, I wish more people understood. Email marketing used to be the best, but email read rates are usually less than 20% and it's over a few days. There is a better medium to build an audience that guarantees they get read...And definitely agree about not spamming or abusing the privilege.
    • jasonkolb 14y ago
      Ok, now I'm curious... which medium/channel are you talking about?
• nsns 14y ago
  It seems there are two different "Facebooks" - one for people, a real "scoial' network, the other for commercial entities and their customers. And this unacknowledged duality seems to be slowly coming apart. There might be a huge opening here for a "companies only" facebook clone, where you can only get updates from your favorite brands and service providers, not socialize with friends.
  • ryangilbert 14y ago
    The reason it works for companies right now too is because everyone and their mom already on Facebook. I doubt a new "companies only" Facebook would really do well.
    • stevewillows 14y ago
      It would essentially be a 'like' button on Superpages.com -- and like you said, it wouldn't catch on. Communication would be glorified, targeted mailing lists.
  • jonursenbach 14y ago
    "There might be a huge opening here for a "companies only" facebook clone, where you can only get updates from your favorite brands and service providers, not socialize with friends." Isn't this just Twitter?
    • josefresco 14y ago
      No it's called LinkedIn. And while valuable in it's own right has no where near the engagement numbers of Facebook.
      • hoka 14y ago
        I don't think LinkedIn is good for this at all. I see things like earnings press releases on LinkedIn, or "XYZ, Inc. invents new 2nm transistor that won't be around for 300 years." on LinkedIn. LinkedIn presents itself as a social network for professionals, and I think they cover that quite well. Twitter doesn't quite fit nsns's description as a 'Companies Only' social network, as much of it is social. I don't necessarily know that anyone would willingly sign up for a companies only social network, despite what companies may dream and pray for :-)
• mamoswined 14y ago
  Why not use all social networking avenues? I use Instragram, Tumblr, and Twitter alongside Facebook, but even without paying anything on Facebook, I get views and interaction from users that I wouldn't get if I said "fuck it" about Facebook.
  • RobAtticus 14y ago
    My impression from the article is that's what he's doing. He's still going to use FB, just de-emphasize it as the main source for fans to follow the Mavs.
    • mamoswined 14y ago
      I feel like totally different people use Twitter compared to FB, with some intersection. I x-post everything.
  • cpeterso 14y ago
    With so many social services, it seems like some meta-service or RSS-like application will subsume them all.
• WordBiLLY 14y ago
  Facebook certainly has a challenge on their hands with this issue but this move is surely going to be difficult for smaller businesses to absorb. Many small businesses have flocked to the giant to build their followings and connect with them but the exorbitant fees are already proving to be prohibitive. Is their truth to the same kind of changes in reach in personal (non-business) accounts and feed as well?
• pejoculant 14y ago
  Is it just me or does $3000 seem like a really cheap price for the Dallas Mavericks to reach 1M+ fans? Would it make any significant difference to their marketing budget if the price were cut to $1000 or doubled to $6000?
  • bluetidepro 14y ago
    I had the same thought. Think of when you go to an NBA game and they give out some sort of "freebie". I would imagine those game "freebies" cost much more than $3000, and regardless of that, with Facebook you are potentially reaching the 1M+ fans where as those game "freebies" might only be handed out to a measly 5K. It seems like a no-brainer to use Facebook to reach 1M+ fans at that price, vs what they traditionally pay for other forms of marketing. Also, you could easily be selective on what sort of post validates for a $3K (post) promotion. Not all posts are worth promoting to every one of your fans, doing so would just weaken the brand image (in my eyes).
    • patrickk 14y ago
      The problem is that you got that reach before for free. It's the change that's upset people. If Twitter started charging companies for tweeting there would be a similar backlash. People feel betrayed by a company desperate for new revenue.
      • bluetidepro 14y ago
        Yeah, very true. That makes much more sense why people are upset. However, I still think they should just take a step back and just look at the cost of more "traditional" alternatives that, what it seems like, are never even questioned for their price to value ratio. An extreme example would be how the Ford Explorer launch on Facebook generated more traffic than a Super Bowl ad [1]. [1] http://www.socialsyntax.net/2012/02/facebook-trumped-super-bowl-ads-but-marketing-integration-is-the-key/ http://www.socialsyntax.net/2012/02/facebook-trumped-super-b...
  • spinchange 14y ago
    What was the "acquisition cost" of those 1M+ Facebook fans (likes)? Ostensibly, this is "double dipping" on the part of Facebook from the perspective of businesses and brands who've been marketing their FB presence in aims of adding subscribers they can reach.
• glesica 14y ago
  Good riddance! What he and others are complaining about is that Facebook has started to use pricing to stop them from spamming users. This is a good thing! We're free-marketeers, right? Prices allow scarce resources (eyeballs, users are the product, remember?) to be rationed in an efficient manner. Would he prefer some nameless, faceless bureaucracy determine who gets to see his messages? This is a commons problem on some level. Very similar to the issue with push notifications written about elsewhere. Too many companies used Facebook as a way to get around email spam filters, and now everyone (good actors included) is suffering. Cry me a river.
  • arron61 14y ago
    If you are constantly getting spammed by a fan page that you explicitly liked or followed, then the appropriate answer is to unlike or unfollow it. There's no reason to curate information that you wanted to get to begin with. What if Twitter implemented something like this where certain tweets from a person you are following do not appear? How would that feel? This strikes me totally as a money play and not for the user.
    • thehodge 14y ago
      However as you can see from that screenshot, a brand can target fans and friends of fans, so even if you don't like it a brand, you can see see the ad if your friend does
      • cjensen 14y ago
        Yes, but it as the screenshot says, it costs a lot to just reach your fans. Reaching friends of fans is a different issue.
    • TeMPOraL 14y ago
      > There's no reason to curate information that you wanted to get to begin with. But are you sure users actually wanted that information? I strongly believe this assumption is false. If I "like" something, I want to express that I like it. I want my friends to know it. It's not a "subscribe" button, it's a "like" button, and contrary to what people in spam^H^H^H^Had business may believe, people actually attach meaning to what is written. It's not a #:G4202 button, it's a "like" button. If you call it "follow", you get a different meaning and different expectations. > What if Twitter implemented something like this where certain tweets from a person you are following do not appear? How would that feel? Twitter is not Facebook. Twitter is about following people. Facebook is about showing people (my friends) what I like (and not necessarily caring what it has to say). I, for one, welcome these new changes and want to repeat by GP: good riddance!
• orangethirty 14y ago
  He makes fair points. Though the one thing that really grinds my gears about Facebook (and I will state it so that Facebookers can consider the issue) is that I cannot use their Open Graph API to build FB apps without being an active member of the network. Being an active FB member requires me to give them my mobile number, an spend a questionable amount of time using it. Time better spent working. I wish I could just pay them a developers fee ($50/year ? ), and have my own little dev account with no other feature other than being able to use the API.
  • bluetidepro 14y ago
    > "Being an active FB member requires me to give them my mobile number" That is not true. I have a Facebook and no where have I ever been required to give my mobile number. I think you only need an email (and I think, it doesn't even necessarily have to be valid) to create an account. > "...spend a questionable amount of time" I created a test account for an app I'm working on (the other month) in less than 5 minutes, give or take. For an app you are building with their API, 5 minutes of time and getting to use it for free is the same as "($50/year)" as you mentioned? That seems a bit exaggerated to me.
  • patja 14y ago
    I wish you could pay for a developer account just so they will bother to manage their bug tracking system.
  • TeMPOraL 14y ago
    But what kind of apps do you want to make on Facebook if you don't use Facebook yourself? How do you plan to test it, or even make sure if it fits the ecosystem?
    • orangethirty 14y ago
      The developer account should allow me to test for that.
• josefresco 14y ago
  I don't get it. Facebook isn't working out so they are considering a change to MySpace or Tumblr? How about changing your focus to oh I dunno ... your website!? Moving from one free, closed-garden system to another isn't progress.
  • ckluis 14y ago
    This - it's so dumb to cry about that. Build your brand on our website, your own social network, & your own smart phone apps. They can push/pull/interact with any other - but not building your own with that type of budget is assinine.
  • matznerd 14y ago
    Website is a great place to host content, but they still need sources to drive traffic. They should be using all of the platforms to drive people there and then capture their emails and other data.
• colmmacc 14y ago
  Without meaning to be unnecessarily negative; what I find most interesting about this post is that neither the article, nor any comments in this thread so far, even mention Google Plus. Cuban seems to write it off as a contender, even a revived MySpace seems more likely to him as an alternative. Why?
  • josefresco 14y ago
    He's bluffing, and could have easily said Orkut or Pinterest.
    • hayksaakian 14y ago
      Good point, last I remember pintrest is more popular than MySpace.
  • xxbondsxx 14y ago
    Because outside of Silicon Valley, Google+ is perceived as a ghost town. Every time someone says this in a HN thread, dozens of people respond with cute anecdotes about how great their experience is, but this place is like an echo chamber. If you actually go out and get the public _perception_ of G+ it's quite negative. I mean Vic got his big G+ talk at I/O completely cut off for the sake of another product. That should show you the shift in Larry and Sergey's priorities
  • zalew 14y ago
    while g+ haven't yet (like the linux desktop year yet) reached the average joe crowd, and I really like this guy, mentioning myspace sound bonkers. another possibility is some of his businesses just go well with the myspace crowd.
• loceng 14y ago
  It makes sense for him to want to leave considering Facebook is really just providing a newsletter service, and it was the marketing that the companies have done to drive them to their Facebook pages. It should be a mutually beneficial relationship, not one where Facebook is trying to milk both companies and consumers. The problem is they aren't making 'enough' off of consumers, and therefore are trying to go after companies too. It's chicken and egg problem, and now that Facebook has 'everyone' on it they are trying to milk it. Yes, there is value of guaranteeing that X number of followers will see a post in their feed - which true fans would want to see anyway (and based on algorithms likely would or would be an active visitor to their Facebook page), however Facebook is trying to prove their $100 billion valuation by essentially trying to extort companies, whereas it should be a slightly above cost of reaching (as the minimum). Facebook is trying to charge Advertising prices for something that is at its foundation a service being provided; Facebook has no monopoly on containing fans. If Facebook doesn't change this quickly it has no chance of ever becoming a $100 billion company, because by that time Facebook won't be freely marketed by big companies linking to their 'Facebook pages.' Facebook's abusing the relationship, and like anyone in an abusive relationship - it won't end well for the abuser, they won't get what they want. - at least not once more people realize it's abuse and they don't need to be in that relationship.
  • eliza1wright 14y ago
    Agreed. It sounds whiny coming from Cuban, but imagine you're a small business owner who relies on your Facebook page to communicate with your fans. You put a lot of time and money into gaining those fans organically, and now Facebook is essentially holding them hostage. What was that little blurb that Facebook used to have on their sign-on page? "It's free and it always will be." Hmmm. Don't promise a free service and then reneg. Perhaps businesses wouldn't have been so eager to get on Facebook if they knew that access to their fans would come at a steep price.
• parka 14y ago
  Here's another way to look at this. When I subscribe to a page, I expect to get updates on new postings. Because Facebook is using their EdgeRank to filter out those postings, I'm no longer get updates on all the postings. As such I've to go to the subscribed page manually. No wonder I'm getting so few updates lately. Because Facebook is filtering out everything. How backwards is that?
  • TeMPOraL 14y ago
    Go to your profile, find the list of things you like. https://www.facebook.com/[user https://www.facebook.com/[user ID or name]/favorites Tell me, do you want to receive updates on all of 0.5k things you liked? Because if each of them writes even one post a week, you can forget about ever reading things from your family and friends. And the latter is what Facebook was designed for.
• hkmurakami 14y ago
  >"I haven't bought and I wouldn't buy here. I think they have to determine what their business is right now and how they will make money at it. I don't believe they are clear about either." Odd. I distinctly remember Cuban saying how he bought FB stock as a trade, and exited the position at a loss when he saw that the initial rally wasn't going to materialize.
  • mikeryan 14y ago
    He did, I think the key word in that thread is the "here". A lot of analysts like Facebook at the $18-$20 price point, something reflected in the stocks relative stability since August. He did buy into the IPO expecting a quick bump which didn't materialize. And he doesn't blame Facebook for it. http://blogmaverick.com/2012/09/04/facebook-handled-their-ipo-exactly-right/ http://blogmaverick.com/2012/09/04/facebook-handled-their-ip...
• arbuge 14y ago
  If anything the situation is worse than he makes it out to be because apart from Edgerank factors there's also the ease with which fans can permanently hide the visibility of page posts. All it takes is disapproval of one post, followed by a single unsubscribe. No easy way around this maybe, since fans have to be able to easily unsubscribe, but it's another big reason why collecting a ton of likes for your Facebook page may be largely wasted energy.
  • TeMPOraL 14y ago
    How about not posting shit as a way to prevent people from unliking? I see more and more companies posting things without any value just to make sure their logo pops up regularly on user's news feed.
    • arbuge 14y ago
      I think that misses my point. I'm all for easy hiding of page posts for fans, but the honest thing for FB to do is call a spade a spade and remove the Like when that happens. As things stand the page still thinks they have a fan when they don't - it's not a good reflection of reality.
• macspoofing 14y ago
  His vision of Facebook makes no sense. There is no chance in hell Facebook will allow every "Liked" product, service and company to spam the users' newsfeed as much as they want, considering the primary purpose of it is to keep up to date with what friends and family are doing.
  • nollidge 14y ago
    > There is no chance in hell Facebook will allow every "Liked" product, service and company to spam the users' newsfeed as much as they want Except that's exactly what they've done for years now. The real problem is that Facebook didn't limit this from the beginning, because now companies are going to complain. I removed all my "likes" several years ago for that reason. Facebook likes to push out extreme changes and then walk them back to what people actually want. This is the opposite of the right way to do it.
    • bduerst 14y ago
      That's usually how it works with commons - everybody can use it until someone starts to screw it up. Facebook originally allowed this because it enticed both user and content engagement. Now, Facebook needs to reel it back in to preserve whatever value is left of it's activity feed - before it becomes the next useless myspace.
      • grey-area 14y ago
        What FB should have done is let users control what is in their feed - give them options to define groups of people and let them view just certain groups in the feed, or split the concepts of liking and following. Instead it seems Facebook is happy to spam users for you if you'll pay for the privilege. Not really good for anyone involved, and not worth it for businesses long term to pay only to be perceived as unwanted spam amongst personal posts.
        • nollidge 14y ago
          Facebook does have groups. But yes, what Facebook did was a bait-and-switch: there were likes, which were just biographical information, but then those turned into subscriptions.
• jrwoodruff 14y ago
  This is kind of amusing, in a way. It always seemed weird to me that large corporations were willing to invest so much in promoting Facebook - From CNN promoting it on every commercial to big brands creating departments to manage 'Social Media' - e.g. Facebook and Twitter. Did they all think this was free advertising, forever? FB is (at least now) a publicly traded, 'walled garden' after all, and Twitter isn't much different. Looks like the social media revenue model is becoming clear: All your customer are belong to us, pay up.
  • radicaldreamer 14y ago
    Isn't the model always been clear: advertising? You can run around in circles moaning about how it isn't "fair", but it isn't the Mark Cuban who built the infrastructure or attracted the users with a core product on Facebook. Secondly, Facebook never guaranteed 100% reach, I'm not sure why Mark Cuban expects it (and for free!).
    • eliza1wright 14y ago
      I dunno, I think businesses realize that reach comes at a cost. In FB's case, however, they interpreted the cost as the time, effort, and resources that it takes to build a fanbase and pump out relevant, interesting content. Now they have to pay more to reach people who've voluntarily said, in essence, "I want to read/see your stuff." It feels a bit like a bait-and-switch.
    • ebiester 14y ago
      To be fair, he asked in his post for cost certainty, not "free." Now, honestly, what I want as a user and as an advertiser is the ability for the user to turn up and down the volume of another entity, be it a person or brand. I may want medium on George Takei, high on King's X and low on Hormel's Spam (yes, I like Spam.) Do you think it'd be valuable to send things to different demographics as a brand? I know I think so, especially if I can get some cost certainty. The problem is that the amount of likes and the value of the brand are unrelated. Takei is not going to pay as much as Quizno's, even if he has three times the fans.
• dlapiduz 14y ago
  Why do brands keep pushing traffic to the Facebook/Twitter pages instead of their own pages? They should create dynamic interesting content on their main pages and use social media to push traffic towards it instead of using social media as a goal. Ownership of your following is really important and at the end of the day the only way to do that is to have a proper standalone website.
  • cpeterso 14y ago
    Why do people rob banks? Because that's where the money is. Facebook and Twitter are where the people are.
• chaseadam17 14y ago
  With regard to online advertising - companies follow people, people don't follow companies. Facebook gets this. Let's play worst case scenario here - Cuban convinces all companies to leave Facebook. Then what? Do you honestly think there would be a mass diaspora of users because all the companies left? Hell no. Sure, Facebook's stock would plummet, but they'd still have options, because as long as Facebook has users, it has a future. Now, let's reverse the scenario. All your friends leave Facebook. Then what? You leave too and so do all the companies, because after all, Pepsi doesn't hang out on Facebook to advertise to Coke. If the people leave, Facebook dies. Facebook isn't a charity, nor a utopia, it's a company that is required by law to maximize value for shareholders. Facebook is already a master of providing value, they've built an empire by doing so. Now they have to learn how to extract value, and it's very smart of them to begin by extracting value from companies in a way that doesn't significantly impact user experience. But this is just the beginning. Soon, Facebook will begin extracting value from people in more obvious ways. And I'd bet the #1 question on Zuckerberg's mind right now is, "How much shit will people take?" How many ads until everyone leaves? I don't know the answer to that, but judging by how much shit is forced down the throat of an average American during a 30-minute episode of MTV cribs, I'd bet we'll take a lot more than we realize.
• jacquesm 14y ago
  Easy fix: change the text on the like button to 'spam me and my friends'.
• drivingmenuts 14y ago
  FB is probably the last social network I'll ever use. If it goes, I'm back to email plus a whitelist and updating my webpage once every two years or so.
• joeblau 14y ago
  > "The big negative for Facebook is that we will no longer push for likes or subscribers because we can't reach them all. Why would we invest in extending our Facebook audience size if we have to pay to reach them? That's crazy. I think this mindset is the poisons venom in Facebook's revenue strategy. Facebook is seen as just a social network and not a legitimate communication or advertising platform like TV, radio, or mobile phones. Cuban has no problem paying for Ad's on Radio and TV, but is appalled when Facebook charges for a similar (And arguably more accurate) service. Facebook's response also makes little logical sense--On one hand they say the fees are to fight spam, but the screen clearly shows that the fees are to communicate with more people.
  • jbail 14y ago
    TV/Radio/Google Adwords/etc is drastically different from FB's advertising model. The key point, as Cuban says in this article, is that companies spend real resources in trying to acquire "Likes" on FB. People build entire FB tabs. Curate what content gets posted. Build deep integrations on their websites. I've built a lot of this type of FB integration for clients...and I charge a lot, so I know this isn't cheap. People do this with the expectation that they can reach the people who like their brand. When FB changes the game, it breaks this assumption and makes it doubly expensive to curate and communicate with your FB following. This is pretty much the gist what Cuban is arguing in the article. On TV/Radio/Google Adwords/etc, there isn't a first step where a brand spends a lot of time and money sending users to said 3rd party advertising platform. You don't first spend development resources on integrating with the radio station's website, ultimately advertising their website for free and sending them tons of free traffic. You just give the radio or TV station your money, they play your ad, and that's it. That is the extent of your advertising investment. It's very concrete and simple to implement. This is not the extent of the investments people have made in building up FB pages and followers. Brands have spent and continue to spend a ton of time and money on this and like Cuban, they are justified in being ticked off when FB changes the rules in an effort to squeeze revenue from them. I have no doubt that money is the reason behind charging to communicate with your followers on FB. The altruistic motives like "fighting spam" would best be done with an algorithm. It surely wouldn't be something you could "opt out of" just by having a fat wallet. By FB allowing brands to pay them to spam people just means FB is fine with spam as long as they get paid. That doesn't seem like a stance that has the well being on their users foremost in mind.
• BlackNapoleon 14y ago
  How does Cuban make money these days?