Entrepreneurs

Facebook Should Beg to Be Regulated

U.S. government and the U.K. Parliament for a combination of improper collection of user data and poor controls on malicious manipulation of public discourse.

Worst of all, both advertisers and everyday users are starting to drop the biggest of all social networks.

Zuckerberg has been slow to confront these issues directly. Perhaps he hopes that good intentions underlying the utopian ideal of a content-agnostic community platform might be enough to weather the storm. After all, the stock is up sixfold over the past five years and the user community dwarfs all competitors. Plus, he has made tremendous personal efforts to be a good and generous guy.

I imagine he is utterly perplexed about how it all went so wrong so fast.

You Are a Monopoly – Embrace it

There is a silly acronym confusing things in the business press these days: FANG. It refers to Facebook, Amazon, Netflix and Google. Soundbite media practices find this acronym a convenient way to stir the pot, as we did with the misleading “BRIC” acronym 20 years ago. The components of each grouping supposedly share meaningful traits. In reality, they are radically different and can only be understood in terms of what they mean to customers.

Amazon is where you go to shop. Google is where you go to ask questions. Netflix is where you go to watch TV. Facebook is where you go to communicate with friends. Only two of these come close to being monopolies – Google and Facebook – and both share the power of network effects that multiply user benefit in direct correlation to how many other people use it.

Facebook is, and could continue to be, a monopoly based on the same principle that makes Nashville a hotbed of country music or made VHS the winner over Betamax. People use it because other people use it. As such, it is a reasonable concern of government that people using it are treated fairly, since in practice there is no real alternative.

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Facebook is in serious trouble. It has shed almost a quarter of its market cap since the stock peaked at $ 190 in late January. Founder and CEO Mark Zuckerberg is being directly challenged by both the U.S. government and the U.K. Parliament for a combination of improper collection of user data and poor controls on malicious manipulation of public discourse.

Worst of all, both advertisers and everyday users are starting to drop the biggest of all social networks.

Zuckerberg has been slow to confront these issues directly. Perhaps he hopes that good intentions underlying the utopian ideal of a content-agnostic community platform might be enough to weather the storm. After all, the stock is up sixfold over the past five years and the user community dwarfs all competitors. Plus, he has made tremendous personal efforts to be a good and generous guy.

I imagine he is utterly perplexed about how it all went so wrong so fast.

You Are a Monopoly – Embrace it

There is a silly acronym confusing things in the business press these days: FANG. It refers to Facebook, Amazon, Netflix and Google. Soundbite media practices find this acronym a convenient way to stir the pot, as we did with the misleading “BRIC” acronym 20 years ago. The components of each grouping supposedly share meaningful traits. In reality, they are radically different and can only be understood in terms of what they mean to customers.

Amazon is where you go to shop. Google is where you go to ask questions. Netflix is where you go to watch TV. Facebook is where you go to communicate with friends. Only two of these come close to being monopolies – Google and Facebook – and both share the power of network effects that multiply user benefit in direct correlation to how many other people use it.

Facebook is, and could continue to be, a monopoly based on the same principle that makes Nashville a hotbed of country music or made VHS the winner over Betamax. People use it because other people use it. As such, it is a reasonable concern of government that people using it are treated fairly, since in practice there is no real alternative.

Let’s block ads! (Why?)

Forbes – Entrepreneurs

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