What Apple and Amazon get right and what Instagram and Facebook and others get wrong

This blog post, Stop your bitching; you’re not paying for it! – Sensei Blogs, is typical of some of the critics who argue that users of Instagram have no right to get mad. If you agree with the assumptions of the author, it makes sense. However, I am here to argue that you should not agree with those assumptions.

First off, I would argue that the title of this blog post could apply not to you, but to Instagram, Facebook, etc. They should be delighted they are getting such a sweet deal. Not only all this free content from you, but they are getting free promotion / advertising from you and they are getting your social graph…ALL FOR FREE.  Quite the deal, yes? Many companies would love all that free content and advertisers. Somehow social media sites feel that they have a right to it. They are wrong: they do not have a right to it. Look at MySpace, or Friendster, or any of the many start-ups trying to get your content and promotion and social graph. That stuff that you possess, that you create, has alot of value, and no one has a right to it.

You might then argue: my content is not valuable. First off, it is very difficult to say what is of value. I have blog posts that have only a few views, and blog posts that have tens of thousands of views. That’s just me. Multiply that by many bloggers and you have a Long Tail in action. And if your social media site (e.g. Instagram) is seen as valuable by a lot of people, then big name companies will flock to it and bring alot more value to it. Likewise, if no one cares about your site anymore (e.g. My Space), then you can forget about getting big name companies to your site unless you are willing to pay them a lot of money. That’s right: even those trivial blog posts and photos of cats add up one way or another.

Furthermore, the service that social media sites are providing is not all that valuable. I am sure their IT people work hard. But really, is there anything about the technology used by Instagram, or Facebook, or any social media company that is so advanced, so revolutionary, that you think: if I don’t use this site, my life won’t be the same? If anything, the sites that provide you email provide a much more valuable service than social media sites. Likewise, the technology of social media sites is not difficult to recreate. What makes Facebook powerful is not the souped up PHP code that they write: it’s the social graph you bring and the activity you engage in there. People use Facebook despite the technology, not because of it. People use Instagram not because of the filters, but because of the others that they want to share photos with.

You might argue: well, they need to make money. Sorry, but no one is entitled to that. Ask journalists and other quality writers: they provide a much more valuable service than social media sites, and they have a devil of a time making money. Same with many folks creating things on the web. Everyone is having a hard time making money, and social media sites are no more entitled to it than anyone else. Is that good? No. Is it the way it is for many at this time? Yes.

Which brings me to Apple and the App Store. Apple has a different model than social media sites. With Apple, you create content (i.e., an app) and if it is of good quality, you can put it in the App Store and make money from it. The chances of you making money are slim, but the chances of you making money on Instagram or Facebook is none. Likewise if you publish an e-book on Amazon. You have some chance of making some money from it. I think the way of the future is in content aggregators that pay content creators for their content. Aggregators that respect your content, not try and rip it off.

When people say: “if you are not paying, you are the product, not the customer”, tell them that they have it wrong. If you are not paying, you are the staff, not the product. And as the staff, you expect to benefit somehow.  Demand payment or good service, and if you don’t get it, go elsewhere. You aren’t beholden to any site, and the material you create has value to you and lots of other people. Expect more for it. Don’t settle for being taken advantage of and used. You deserve better.

Over time, the sites that provide more value to users will win over sites that don’t. Business models that rip off users will become archaic. You can be skeptical, but I would advise any start-up that wants to win work on developing a tangible rewards program. Over time those will companies will be the winners.

2 responses to “What Apple and Amazon get right and what Instagram and Facebook and others get wrong

  1. Well put, Bernie. I think the idea of content as apps is actually interesting and disruptive. A new entrant could do that and displace Facebook: or Facebook could do that themselves to preempt others from trying. If I invest the same effort as I give to my Twitter or Facebook accounts but get something in return (not necessarily a monetary one) based on reactions, I may have an incentive to post more interesting or provoking. The dynamics would change, but it may make more sense than the current model. You could even call the new social network service Berniester 🙂

    • smartpeopleiknow

      LOL! I don’t know if Berniester will stick, Aaron, but otherwise I like your comment. I do think that a new entrant with that type of model would disrupt the current social media giants and get them to follow them. I am not sure why more startups haven’t pursued this approach, but once a certain critical mass is reached, I think it will.