Building Competition To The Current Social Media Hegemonybr>
In an age where social media is ubiquitous, and privacy intrusions are commonplace, the current social media hegemony has come into question. Particularly concerning Facebook, which along with its control of WhatsApp and Instagram encompasses more than 1 billion users, the harvesting of data and the “free” nature of the advertising paradigm appears tenuous amid rising public dismay with the social media giant’s influence.
Social media platforms are free because the users are the product, with the proclivity of Facebook to sell their data and read their messages documented in Congressional testimony and mainstream media, respectively.
The concern around Facebook’s global influence reached a boiling point earlier this year with the announcement of Libra — the private, consortium-backed stablecoin initiative designed by the firm. Unsurprisingly, the announcement was met with stiff regulatory scrutiny worldwide, which continues among ex-Fed employees and European central bankers today.
The quandary is over the potential threat that commingling social media and financial data has over privacy, not to mention the extrapolated effects of replacing the fiat hegemony with a corporate-driven model.
But how do you challenge such a dynamic force? A firm that has billions in cash reserves and an army of algorithms and talented employees?
Governments have shown concern over Libra, but the onus falls on the private sector, entrepreneurs, to reconcile the wider social media hegemony of today with the sentiment towards better privacy and monetization that younger generations seek. Otherwise, such dystopian visions portrayed by Orwell and Huxley may materialize into reality.
The Need for Privacy
As outlined by MultiCoin Capital’s Crypto Mega Theses, censorship-resistance cannot be achieved without privacy. Whether the billions of social media users today realize it or not, censorship is not only possible but happening in many areas of the physical and digital world.
As social media venues increasingly become the digital town squares for public discourse, privacy progressively becomes more critical to safeguard.
For example, in the current advertising model that underscores “free” social media platforms like Facebook and Instagram, user data is harvested and given to third-parties — mostly advertisers. As a result, large tech firms pull in massive sums of revenue via the manipulation of information that should remain private. And that information is becoming increasingly sensitive; from personalized videos to friends and private conversations of families all at the fingertips of tech firms via their centralized data storage structures.
The intrusions into privacy via social media today are subtle. Most users have no analog or context for such intrusions and are happy to make the trade-off of a free social media platform with minor privacy exposures. However, that will not always be the case as data becomes more integrated and personal.
Eventually, a tipping point will be reached. And Facebook’s foray into finance with Libra is the flagship example of what that tipping point may look like.
Legitimate fears over the progression of commingled financial and social media data into social credit scores are well-founded. A social credit score is already active in China, and although many US citizens imagine the chances of such a system developing in their own country as remote, there is a precedent for the abuse of such integrated data.
One method to circumvent such developments from ever materializing is to sever the connection between financial and social media data, which can be accomplished by regulation. However, the optimal method is to rely on technological innovation to give power over data and privacy back to the users — such as with blockchain-based social media like Howdoo, integrated crypto payment rails, and privacy tools like Signal.
For example, Howdoo gives control of data back to the users, blocking third-party access to their personal content unless otherwise allowed by the user. This is a powerful level for giving privacy back to the users on public platforms that have been otherwise abused by major social media firms. The Howdoo model also opens the door for new monetization avenues for content creators, which are tethered to the privacy assurances of crypto-based payment rails.
Additionally, in the case of blockchain-based social media, financial compensation (i.e., content monetization) can even be coupled with an all-encompassing media platform — reflective of demands among Gen Z and Millennials today.
Content Monetization & Young Preferences
It is expected that nearly 3 billion people will be using social media by 2020, which will account for just under half of the global population. The largest allocation of users is younger generations, specifically Gen Z and Millennials — both of which are the conduits of most digital content today.
Content is king, and as young people increasingly interact online, they are going to seek more avenues for monetizing their work.
Unfortunately, such monetization is handcuffed by the advertising paradigm of today. Advertisers take enormous cuts from influencers on platforms like Instagram, and the advertisers, in turn, are taken to the financial woodshed by the social media firms themselves. Fair compensation for younger content creators requires the removal of costly intermediaries.
We’re already seeing the beginning of such trends in the battle between Google Chrome and privacy-oriented browser Brave, but the situation extends to the potential of building open, all-encompassing social platforms — where media from video to blogs are accessible, private, and monetized.
Public blockchains like Ethereum provide the ideal mediums for distributing the control over user data, enhancing privacy and censorship-resistance concurrently with bolstering monetization. With no central point of failure, cryptographic proofs, and reduced transaction costs, public blockchains are socially scalable. Networks that are socially scalable are potent competition to established institutions, especially of the centralized variety.
Tilting at tech giants requires fervent, antagonistic, and technologically sound projects that coalesce open-source communities into faceless competitors. That’s how the private sector can compete with the vast resources of tech corporations, and quite possibly the best solution to combating the adverse consequences of today’s social media hegemony.
Social media is a double-edged sword, one whose adverse consequences have tarried behind the advantages for years until recently.
Regulators may prove useful in stifling the dangerous commingling of personal and financial data unveiled with Libra, but ultimately, building competition to the social media giants of today requires more nuance — a vision of privacy coupled with user power over data and its monetization.