The Meaning of "Life" Online - The Profit Model Behind Social Media

A profound concept of how social media is affecting our lifes can be summarized quite succinctly:

It's taking previously un-monetized conversations we used to have offline and making money from them by putting them on a technology platform that enables advertisers to interrupt our conversations, emotions and socializing with advertising.

There is no other way to put it. A person only has so much time to communicate, socialize and converse. Forgive the stereotypical example; If a teenage girl once spent 2 hours talking on the phone to her friends every day, she now spends that same time on Facebook which is a technology that enables advertisers to capitalize on her conversations. Social Networking and Social Media didn't invent more time for us to socialize. They're just eroding time from traditional communication channels and monetizing those conversations.

It's never been attempted before. Advertising has traditionally been about monetizing content, which is not necessarily a bad thing, since so much of our content involves commercial intent. So it makes sense that if someone writes an article about the health benefits of soy that an advertisement could be placed in that content about a soy milk product. This is not to say that content should be written for commerce, that is mistaking cause and effect. Advertising can plausibly appear in or alongside content and still be within context. But creating content for the sake of advertising or profit is clearly detrimental and only serves to bias the created content.

But what we're talking about here is really the question of how companies can make money from our conversations. It's been said that social media conversations are like a return to the campfire. But it's nothing like that. It's an effort to interrupt our conversations with advertising.

There is an obvious value to Facebook and Twitter (somewhere) but I'm not sure where it is yet or how it will be monetized. I'm certainly sick of seing ads plastered all over my life but at the same time, if I was given an option to pay for facebook (to get rid of ads) or use a more traditional (or existing) communication channel, I would probably choose the latter.

Additionally, I think you'll find the ones that use Facebook the most use it because it IS free and ubiquitous, but that's also the demographic with the least amount of income and spending power (online). Not to mention that demographic (the tweens) don't even legally have credit cards yet to pay for online services (unless their parents have given them the use of one).