The Economics of Evil
Nic asks -
can evil still be successful?
Viz, danah:
"...Given what I’ve learned from interviewing teens and college students over the years, they have *no* idea that these changes are taking place (until an incident occurs)."It's a good question.
Let me try and make the economics of evil crystal clear, by discussing Facebook (again :) .
Evil isn't (just) a PR issue.
That's only the most superficial cost of evil.
If you've been reading, you'll note I've said many times - evil isn't a problem because of the bad PR it generates.
Rather, evil is dominated in the edgeconomy because it destroys the potential for future value creation.
Because Facebook is evil, it created Beacon, which actually
raises the costs to interaction, imploding the utility of the network.
So
whether or not your average lame brainless Ivy League teen is aware of it - he/she will feel it's effects, and their behaviour will, in turn, begin indirectly to shift.
So there are two effects. One is an information effect. I know you're evil, so I won't directly interact with you. That's a weak effect.
The stronger effect is the second: when you're evil, all else equal -
even if others interact with you - your ability to co-create value implodes: because you make moves which are focused on shifting costs and extracting value, rather than creating it.
But it takes two to dance the tango of co-creation.
Conversely: when you're evil, the only game you want to - or can play - is domination.
That's exactly Facebook's problem: because it's evil, it's massive network is a deadweight loss - Facebook is learning to co-create no value with it, just trying to extract value
from it.
And that's deeply dominated. Transferring value (
from consumers
to advertisers) isn't anything resembling strategy: the value of the network either shrinks or stays flat - but it certainly doesn't grow.
And from a strategic point of view, that just opens massive market space for other players, by raising the costs of interacting on Facebook.
Now, yes - the initial effects will be slow. But they're, like most other things, in the edgeconomy, nonlinear. Once the inflection point is reached - bang.
These economics hold true at every level of the next economy. Whether it's Ford, P&G, IBM, or CBS - good beats evil.
If you really wanna think about this stuff,
reread this post.
You are so right about the dead weight bar being raised due to the hype that is Facebook. It is as if otherwise intelligent product management executives can't tear themselves away, and have been bitten by a fever.
I had completed an assigned six month research cycle on brand monitoring services for a major telecom's R&D lab, and after the big wrap up presentation, do you think they had intelligent follow up questions on the matter at hand?
http://abmw.wordpress.com/portfolio-samples/
No, the first question was, "How does this fit into a Facebook App?".
Ye Gads.
