Nobody Will Win The Social Internet Race Until Social Networks Start To Understand Their Purpose To Users, And The Models That Work In The Social Network Play

There was an article today about Google+. What was most interesting wasn’t the article so much as the comments from readers. A few comments from the post:

“I could not care less what stupid pages my stupid friends like,”

“Nobody goes to facebook to look at ads, they go to discuss stuff with their friends,”

“They (social networks) all kind of suck, these companies just want your money, bottom-line.”

“They day fb let people make applications and users stormed it with all type of random, boring and time wasting applications, it started its decline.”

If you notice, these are all complaints about social network companies interrupting the user experience, which for the users is: To talk to other people. In other words, communicate. Sharing, discovering, etc. is an organic part of this interaction, but not larger than the actual functionality of communication itself.

Information delivery (Twitter’s position) is also a part of this, but it’s not the true reason or motivation of why people use social networks, either. It’s a secondary element — people breaking news and broadcasting what’s going on in the world around them has always been an ancillary element of social networks and always will. It’s not, however, the core reason why people use these type of services, really. Not to mention there are plenty of other sources for obtaining information on the internet. Anybody taking that position is very late to the game.

That’s because social networks are ultimately communications companies. Mess with that functionality, and you’ll find the decline come fast. Create that functionality with users in mind and stay out of their stream of conversation (as legacy communications companies have learned to do for decades) and you’ll find the services you offer will scale and thrive.

There is a position for information delivery that social networks can take, but it’s more of a cable distribution model of giving users access to various content from content providers, than a breaking news type of thing. This is a unique and ancillary play to the core functionality and purpose of a social network to users, and a tricky one. It can be done, but it needs to be built for and around the users, who cut their teeth first on social networks being a new form of communications service.

Regardless, in the communications service environment, ad revenue hasn’t been a strong model. That’s because inserting anything (particularly ads) in the above interrupts why users are using communications tools — to communicate. That’s why telcos (legacy communications companies) have never relied on ad models but value added service. You can learn more about the value added service model here. The ad model can work in the information delivery position, but that would likely be a revenue split with the content companies, versus intrusive advertisement cluttering the user experience.

Subscription models, of course, were always the most effective for companies in both environments, which is why people have been paying for phone and cable services for decades. Believe it or not, it’s users — not businesses — that drive the survival of subscription models, because users want a more quality experience and millions are willing to pay for it if the desire is there and the price is right. NFL football packages are a great example of this.

The winner of the social internet will be the one who understands this. Smart social network companies will not just be experimenting with how to make the user experience better, but monetization models as well. Historically, value added services were the way communications service providers made their money and that’ll likely be the case with social networks too. Eventually, everything will end up here as the rules of engagement and monetization in information delivery and communications platforms has not changed in decades or with disruption and won’t with the internet either.

But the biggest issue social networks are going to face isn’t all of the above alone. Communications over the internet is about to disrupt in a very big way — whether or not Facebook, Twitter, and Google+ survive in this environment will depend more on their ability to position for this, than any features or revenue models they use in their play.