A probably dark future for Facebook Connect

Since the credit crunch and the crisis in economy started to show their ugly heads, pessimistic scenarios of doom and gloom circulated the Internet. VCs signaled their own mayday, advising their customers to save cash, lay low and accept a possible M&A in order to survive. In other words, they’re telling smaller companies that if they want to stay in business, they better sell themselves to the bigger ones if such an opportunity is raised.

But this doesn’t apply only to small companies. The lack of credit in the world makes value not so “valuable” without cash to back it up, and it has been said that even web start-ups that have been uber successful (like Twitter) could be in danger if they don’t find a way to monetize soon. Considering the hard times that are coming, that’s true. When all cash is burnt, the company either goes to the deadpool, or sells itself to someone with loads of cash.

Facebook faces a monetization problem as well. It may be the biggest social network in the world today (at least in terms of users and visits), yet it had failed to find a way to monetize since not so many people care to click on its ads. However, Facebook does have a lot of cash right now, a part of which (a mere $240 million) comes from investments by Microsoft. But why did Microsoft want to invest in Facebook? I think it was because of fear; fear that Google would, eventually, buy Facebook.

Facebook Connect vs. Open Social

The reason Google would want to buy Facebook is simple: to make it support Open Social, instead of Facebook’s own proprietary Connect. Both of these APIs make it possible to share information from one social network to another. For example, you could use your Facebook account (you have one, right?) to connect to another social network with the same credentials, access your friends list and even do stuff there that would inform Facebook to post a story on your wall.

Facebook Connect

This is so powerful, that it could even merge with OpenID. For example, LivePoker, an iPhone app, lets you play poker online through the device by logging into the system using your Facebook account. Then, you can play against other Facebook users or your friends if they’re online. This way, you don’t have to create yet another account for the LivePoker service, and you’re carrying with you all the social information you’ve so deliberately crafted in Facebook to present yourself online. It’s a huge thing, and Google definitely lusts for it.

All data should be open and accessible

Google wants everything to be open. They’re big supporters of openness. Android is an open API, and they managed to get the FCC to support openness in the wireless spectrum. They simply want all data to be accessible, so they can index it and use it. Google wants to have access to all information there is out there in the world; they want to know everything about anything and they have an infrastructure to support this. If Facebook goes against this openness and insists on using their own proprietary API for their own good, Google has no other solution than to acquire them and force them to open up and conform to Open Social.

Considering this, Microsoft did a good thing investing in the popular social network, thus extending its runway and delaying such an acquisition. Otherwise, Mark Zuckerberg and the rest of the board could quite probably find themselves considering an M&A with Google when the times are dark and the cash has gone, which would happen if they don’t find a way to monetize. Maybe they will, maybe they won’t, but at least for now they have time to try and find such a solution.

The dreaded Google – Facebook M&A

Future Facebook

Why do I speak of such an M&A as dreadful? Because it will probably be one of the most big-brother-ish things we’ll see in the years to come. When everything will be social and there will hardly be any human in the western civilization without an online presence, when all the major and minor web services will be supporting open APIs to exchange information (that is, our personal data) and our social network account will become the One Universal ID, I’d be afraid of Google claiming this data for their own use. That is simply going to be too much power in one company’s hands.

Think about it this way: they’ll be crawling and index the whole Web as well as bazillions of e-mail messages from millions of users (Gmail & Google Apps), they’ll be running major web services on their infrastructure (Google App Engine), they’ll have mapped the whole globe (Google Maps & Google Earth) and they’ll have created a “cloud” that would pretty much know everything about anything (like I said in another post that’s what Google officially claim as their goal). I wouldn’t want them to “own” my One Universal ID credentials as well.

One account. One ID. One company. Scares the bejesus out of me.

Twitter delivers the news faster than the media

There are still enough people that don’t get what all this social networking/microblogging thing is about. I was one of them, when I first learned about Twitter when it launched. I mean, why should I inform the public of what I am doing? Why is it so important to post details about my (probably meaningless to others) daily activities? Heck, I was even negative to blogs at first. Social networks, I deterred from for some time. But Twitter? Come on, that’s absurd!

But after some time, I realised that focused people posting articles about their domain of expertise was a good thing and blogging is not useless after all. The social stuff was harder to grasp though; I admit that I wasn’t an early adopter to Facebook, MySpace or the rest of the social networks. For quite some time, I stayed away from them, but then I started to realize the potential that comes from connecting to people. There’s no better advertising than virally spreading the news to your connections, and they forward it to theirs and so on. It’s fun too.

But Twitter? Posting status updates in 140 characters? Why go back to a primitive Internet-style SMS when we’ve got computers, and Internet, social networks- I couldn’t get it. But as in all things, it’s more probable to grasp the idea of something if you participate in it, rather than judging as an observer.

The power of microblogging

Had it been only for status updates, I’d still consider it silly, but it turned out that Twitter evolved into the so-called micro-blogging platform which has potential and momentum. Messages are instant, short (hence easier to read), spread around all followers immediately, it allows personal communication and it’s accessible on-the-go from virtually anywhere on Earth there’s cell signal. If you provide useful content, people follow you and get informed; you can evangelize and promote your stuff and services; you can get the news first.

Get the news first? There’s no “breaking news” sessions in Twitter, that’s only in TV. But the latest tragic incidents in India, showcase (in a very sad way) that the microblogging platform is not only a news source, but the news come faster than traditional media. At least that’s what Arrington claims, and I agree with him. In fact, when I read about the Mumbai attacks on Twitter messages from the people I follow, I asked my wife “hey what’s going on in India?” but she didn’t know, even though she was on the TV.

Uses and abuses of the microblogging wonder

Twitter may not be the most credible news source out there (but is the media credible anyway?) since people can always lie. But when many people seem to claim the same thing and it reaches a critical mass, it becomes a reality. When, for example, you witness the public timeline and everybody’s talking about the attacks, you can’t claim it’s false news, there’s no way all these people would lie at the same time.

But there are cases where people could lie. Think of it, even before Twitter and the Internet, rumors still spread fast and many times they were proven wrong, but it would take longer to span the globe. Today, with the power of the interconnection of billions of people, a malevolent rumor can spread like wildfire affecting millions of people before they get a chance to distrust it. For example, imagine how some fake news could impact the stock market, if some “insider” claimed something “hot” is going on. I bet that a hoax about Steve Job’s heart attack originating from a paramedic (perhaps with a photo attachment of poor Steve in the ambulance) and then being confirmed by numerous other witnesses and insiders, could travel faster than an official statement of Apple about the matter (and Apple is indeed a bit slow when it comes to press releases).

When a critical mass of people lie, that lie becomes a reality. It may not be true, but all that matters is what people believe to be true.

Power to the people

Traditionally, the power of information was a privilege of the media, so when people begin to claim back some part of it, it sure is not a small thing. De-centralizing the news sources and spreading it to individuals around the globe could potentially harm long-standing balances in society. People-casting is radically different from news media, yet quite powerful. The strange thing with people is that there are too many of us and almost totally uncoordinated, yet from within this soup of (mostly useless) information, patterns begin to emerge and it’s not at all improbable for a small piece of information to cause a “hurricane” in a worldwide scale. It’s chaotic, and it can’t be controlled.

I’m pretty sure more and more power will come to the hands of individuals and if the media don’t jump on this wagon they’ll probably regret it. But perhaps the most thrilling aspect of this interconnected information chaos is how it can be (ab)used to deliberately inject information into the network. Will the people maintain the power of information-anarchy, or are they simply going to be the medium through which the same old powers are going to rule the world?