How Facebook Will Profit Even More From Your Profile
Facebook is only free in name. While the company most definitely does not sell your information, Facebook “makes its money from showing you ads,” as a webpage from Facebook explains. So what, you might say: Ads are everywhere, flashing and pop-upping from websites across the internet, on the sidelines of your Gmail account, on the floor of your supermarket.
What’s different is that the ads you are shown on Facebook are tailored to you based on your personal information and on whatever pages, events, etc. you have “liked” on Facebook. Rather than you having to scan the pages of the weekly circulars — those advertising inserts tucked into paper newspapers that many of us never look at anymore — the ads about things you’re likely to be interested in are seamlessly delivered to you.
An “exclusive” guest post on BetaBeat says that new features on Facebook mean that the company, whose spring 2012 IPO is getting closer and closer, will generate even more profits from your profile. The author of the post is an anonymous contributor described as a “former CTO who now does tech consulting for other start-up ventures and was briefed on Facebook’s advertising strategy”; he says that Facebook’s much ballyhooed new Timeline profile was designed not so much with a view to enhance your social media experience, as to enhance advertisers’ brand messaging.
Starting in January, Facebook will also integrate another type of ad, “sponsored stories” — posts and activities that businesses have paid Facebook to feature – into your Timeline. They will look like updates from friends as a friend’s profile photo will be displayed besides content they have “liked.” Facebook has described Timeline as a great innovation that makes it possible to present your entire history back to the day you were born; all Facebook profiles will be converted to the new format by the end of this year.
What most users don’t know is that the new features being introduced are all centered around increasing the value of Facebook to advertisers, to the point where Facebook representatives have been selling the idea that Timeline is actually about re-conceptualizing users around their consumer preferences, or as they put it, “brands are now an essential part of people’s identities.”
The name itself is cleverly designed to conceal the fact that your profile no longer arranges information chronologically. Yes, things are laid out by year and by month. But, when it comes to what’s displayed to your social circle at any given time, other metrics, including direct payments to Facebook itself, will now influence the ranking and placement of stories. This payola will be a crucial part of the graph rank, the new metric for placement that the social network uses to determine what appears on your profile.
The information on your profile will be arranged, BetaBeat suggests, according to an algorithm based on, among other factors, how much businesses pay Facebook.
The Atlantic Wire contacted Facebook about BetaBeat’s post and was told that, but of course, Facebook “isn’t trying to hide anything.” Facebook has tended to be weak about keeping users informed about what all that personal information — all those photos people spend hours tagging and arranging in albums, all the pages you “like” and the bands and movies and information you input on your profile page — is used for. The earlier noted webpage about how Facebook makes its money is an attempt to remedy this, though the webpage‘s explanations are carefully framed so as to suggest that Facebook’s innovative integration of ads into your profile is an improvement over more traditional ads, all while keeping Facebook “free.”
Facebook has devised a brave new world of user-based advertising that is “more relevant but potentially more invasive,” as The Atlantic Wire notes. You can’t avoid the ads on Facebook. Based on the number (800 million) of profiles that exist on Facebook, most users do not seem to mind that a large company is mining the personal information they post to generate ads to show said users. Again, ads are everywhere and if you are shown ads about things you’re interested in, so much the better — but who, ultimately, for?
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