If you haven’t noticed, it’s been a very bad couple weeks for Facebook. Whether you’re paying attention to financial news and watching the stock’s one-way slide, now down more than 40% where it opened, or just looking at Facebook itself, where this week two top executives announced they were leaving for greener pastures, the news is everywhere.
One unavoidable question has been circulating since Facebook started approaching a billion users: Could Facebook ever go the way of Myspace?
That question now seems to be coming home to roost, and the answer seems to be, yes.
Of all the problems Facebook has confronted recently, I believe by far the most problematic one at the root of all the others is the company’s revelation this week that almost 10% of all users worldwide are fake, combined the allegation by BBC and a small startup called Limited Press that up to 80% of the clicks on paid ads are by “bots.”
There’s a great scene in “The Social Network” when Justin Timberlake advises against putting ads on the site for the time being. When you start putting ads up on the site, he says, “the party’s over. Let’s not end the party at 11.”
It appears that in confronting the challenges of growing its reach and using that reach to make money, Facebook faces the same challenges Myspace did—when there’s money to be made through people talking to each other in a digital environment, things start getting spammy. See Chick-fil-A posing as a teenage girl to voice positive sentiments about the chicken chain, for instance.
Facebook always tried to sidestep Myspace-style spam by making its design rigid and uniform and requiring first and last names for sign-up. It’s just not a place that encourages users with names ilke Sexpot6999. Still: the greater its scale the greater the incentive for companies to spend money there, and the greater the motive to game the environment with fake accounts and bots. Ironically, the more Facebook grows the more valuable it becomes, and the more valuable it becomes the more likely it is to attract “undesirable” characters, as Facebook calls them, which in the long run will make it less attractive and therefore less valuable.
We’ve already seen this starting to happen—targeted advertising fell last quarter even as the volume of user posts rose. Mark Zuckerberg today fell out of the top 10 world’s richest tech titans list as the stock continues to fall.
Sure, Facebook is many times larger than Myspace in its wildest dreams. But the core problem it faces seems to be the same: burnout. If Facebook doesn’t future a way to keep the problem from escalating, in a few more years we could remember Mark Zuckerberg as not so different from a guy we used to see named Tom.