Ever since Al Gore invented the internet, gun-slinging entrepreneurs, dusty media giants and wagon trains of marketers have been panning the web for nuggets of consumer data. It’s still the Wild West out there but the California gold rush is over and the Texas oil boom is on. Waiting just below the trickling stream of keywords, likes, and basic demographics is a pressurized cavern of consumer data that Facebook’s Open Graph is threatening to blow sky-high.
Last September, at its annual f8 developer conference, Facebook announced that it would be opening itself up to data from other apps, like Spotify and Runkeeper. In the new Open Graph system, third-party applications are now able to pass information about what you were doing in their worlds–like what songs you were listening to or what workouts you had done–back to the social network, to be recorded on users’ profile pages and displayed to their friends – behaviors known as “actions.” The hope is that Actions published to user’s timelines will function as a discovery engine for that users extended network by helping them discover products, videos, articles, digital services, etc.
Thus far, Actions have been effective. Early success stories about Timeline app and Open Graph are impressive. The same goes for mobile. While the opportunities for third parties are great, the benefit to Facebook is even greater. By centralizing people’s online (and offline) behavior around the their platform, Facebook is creating an immense reserve of consumer data that will be an enormous asset to marketers of all ilk.
Not to be outdone, Google, Bing and Yahoo have announced a new initiative called Schema.org that will create and support a common set of schemas for structured data markup on web pages intended to be a rival to Open Graph.
Going blow for blow, the digital arms race is on. News has leaked from Facebook revealing that it will be releasing its new search engine in the very near future. All the big boys (along with patent trolls) are snatching up digital patents trying to get an edge on the competitors.
Will all this data flying around, and the pace of play accelerating, it’s tough to take a step back and ask the tough questions. What are the cultural implications of all openness? Who will regulate and monitor how companies use our data? What is all this data worth and who lays claim to it?
Zukerberg is forced to walk a very fine line between ensuring that users have “complete control over everything [they] share,” and the privacy issues associated with Facebook’s business philosophy of frictionless sharing.
When sharing is automated, inevitably tidbits of sensitive personal information will make it into the public sphere. Law enforcement’s use of social networking sites in criminal prosecution has already been a contentious subject over the past several months. With the astonishing accuracy of facial recognition software already being licensed to the likes of Microsoft and Facebook, very real questions about the extent of the 4 amendment’s protections need to be discussed.
“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”
Digital rights advocacy groups such as the Electronic Frontier Foundation (EFF) are already very busy addressing civil liberties issues arising from the rapid advancements in telecommunications technology.
Even in the business world, not everyone is drinking the kool-aid. Pandora founder Tim Westergren recognizes that while the company has a strong relationship with Facebook, a significant portion of Pandora’s users are turned off by having their actions published to their Timeline. How can companies strike a balance between monitoring users in the name of improving service and privacy. For now, it’s unclear whether the larger privacy concerns are simply not a genuine deterrent social network users or whether things have progressed so quickly in the past few years that people just haven’t had the time think about it.
After that first taste of Texas tea, everything was destined to change: the economics of the industry, politics, education, and culture. Data is for 21st century information-based industries what petroleum was for the age of mechanization 100 years earlier. For now, advertising is the engine that powers Search and Social. Data is the fuel for that engine, and until we see significant resistance from the public, we can expect the online giants to drill deeper and deeper.