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When It’s This Easy To Take Someone’s Money…

By - February 18, 2013

Earlier in the month I wrote about fraud in the advertising technology ecosystem – a post which has spawned dozens of fascinating conversations that I will continue to write about here and elsewhere. But this past weekend I encountered another kind of scam – a combination of time-honored phishing (online identity theft via social manipulation) and good old-fashioned wire fraud.

My family has been going to a small island off the coast of Massachussets for my entire life – my grandparents are buried there, my great grandmother moved there around the turn of the century (1900, not 2000!). My mother owns a cottage near the beach, a cottage that my great-grandmother purchased nearly 100 years ago.

Suffice to say, I have a deep history with the place. But with a bevy of kids and friends descending upon us each summer, my family has outgrown the cottage, so we’ve started looking for a larger place to rent. Like most folks these days, we turned to the Internet. We fired up VRBO.com, a popular marketplace for quality vacation rentals. It’s a great site for checking the market, and my wife and I figured we might get lucky and find just the right place.

We refined our search to mid-sized homes in Edgartown, MA available on the dates we wanted to stay. Most of the good places were above our desired price range, but one listing really stood out:

We are very familiar with the location of this house, having stayed nearly across the street a few years back. And boy, was the price right – about one-third that of similar homes in the neighborhood. This was a “new listing,” VRBO told us, meaning we were one of the first folks to find it. We better act quick, before this deal goes away!

We emailed the owner using VRBO’s contact widget (shown at right in the screen shot). Within hours, the “owner” had contacted us back. She was ready to send us a contract with payment information right away.

Now, I’ve been around long enough to sense when something wasn’t quite right. First off, she was using a non-personal email from Yahoo (the handle was “livinghome1234″ or somesuch). And the owner’s last name (her first was Kathy) seemed vaguely machine-generated – I won’t repeat it here just in case a real person’s identity has been stolen and re-used to portray the “owner.” When I put the name into Google, I got the kind of results that aren’t exactly comforting – a barely used Facebook page of a person in rural Pennsylvania, and a ton of “find this person” websites. It struck me that someone who owned a million-dollar home on Martha’s Vineyard probably had more of a digital footprint than this.

Secondly, the deal did seem too good to be true. Was I about to take advantage of some poor elderly woman who didn’t understand the true value of her home? Given my history with the island, I didn’t want to be the guy who did that. I decided to cross check Kathy’s name with public real estate records for the address in question.

Turns out, they didn’t match. The real owner of the property was a very nice-looking older woman who was obviously a real person – a year or so ago she had penned a sweet obit in a local paper for her dearly departed poodle. (I know the type very well, she reminded me of my Mom, who spends a lot of time on the island with her beloved golden retriever). Hmm. Well, could be that the person who contacted me – Kathy – was just an agent working on the owner’s behalf. That certainly happens a lot. I called the real owner’s number (it was listed in public real estate records), but got a full answering machine. Darn.

Cautious but still optimistic, I told “Kathy” to send me the contract.

It was about this time I got the following email from VRBO:

Ah, drat. The listing was believed to be a fake.

But hope springs eternal, no? I awoke the next morning to a contract from Kathy. It included wire transfer instructions for the full amount of the rental, to a bank based, interestingly, in the same town as the rural Pennsylvanian’s hollow Facebook page. And it had a phone number at the top – which, when dialed, informed me that the Google Voice subscriber I had called was not available.

At this point I abandoned all hope of snagging that swell house in Edgartown, and called VRBO’s fraud department. They  were nice, but not very helpful, reminding me that the site is “just an advertising service” that does its best to protect its users, but, to summarize: Buyer beware. I asked what made VRBO suspect that the listing was fraudulent, but the nice man on the other end of the phone refused to give any more information, citing privacy concerns.

So, why am I writing all of this up? Isn’t this just another pedestrian case of Internet fraud? Well, yes, and that’s kind of the point.

Think about how easy it was for the fraudster to run this scam. First, scrape all the information from a real listing (probably last summer’s in this case), and resubmit it under a different identity.  Second, create a free email account and Facebook page for an owner’s identity, just in case a renter Googles the fraudulent name (as I did). Third, leverage Google’s free phone service to provide a contact number. And fourth, set up a bank account to collect the dough. Lather, rinse, repeat! After all, if only one in 10,000 attempts gets you a hit, it costs you nothing but time to create those 10,000 opportunities. And with some simple programming scripts, even your time isn’t really that taxed.

When it’s this easy to set up fraudulent transactions, they will flourish – and indeed, within a few hours of my being told about the listing’s suspicious nature, it was up again on VRBO, under a new listing number but otherwise unchanged. (I told VRBO about the new listing, and they once again banned it. But apparently, they don’t have any way to stop someone from listing it yet again.)

A quick perusal of the community boards on VRBO (or any other rental marketplace) reveals that this kind of scam happens a lot in the listings business. And there are some pretty basic steps one should take to insure you don’t get fooled. But to my mind the larger story here is one of incentive, trust and identity. If you take a look at the incentives working on VRBO, it becomes clear how easy it is to game the platform. VRBO wants to make it as frictionless as possible to list hot properties on its site. Renters like me want to quickly score the best deal on a hot property. And owners want to connect to VRBO’s vast market of potential renters.

But VRBO’s business model is also based on trust – as consumers of the service, we want to trust that the identities of those listing their homes for rent are in fact authentic. And clearly, for the vast majority of listings, that is the case. But given how easy it is for scammers to game the system with false listings, I don’t think I’ll ever be sending money to anyone I’ve met via their platform. And that’s a shame – because if VRBO and others took the time to qualify their marketplace up front, this kind of fraud would be far less rampant.

I think there’s a lesson here for all of us in the marketing industry. There are always going to be bad actors trying to game complex systems. Back when click fraud was a major issue, our industry had one major player who had the incentive to clean it up – Google. Google was the dominant player in search, and was a newly public company that couldn’t afford to be seen as profiting from fraud. But the programmatic adtech space is deeply fragmented, with scores of players, all of who are – according to many sources – reaping untold millions in revenue from fraudulent behavior. In short, the incentives to clean this up aren’t exactly aligned.

But imagine if just one major marketer – playing the role of the defrauded rentor – decides to make a public stink about fraud in programmatic exchanges, declaring they’ll never again spend money there. When that happens, our burgeoning ecosystem is imperiled. So once again, I say: It’s time for us to get further out in front of this problem. I’ll have more on how we might do so in future posts. Meanwhile, wish me luck in finding a place to stay this summer – from now on, I’ll be working with real humans who work on the island and know the owners personally. It might cost me more, but at least I’ll have a place to stay at the end of the day.

  • Content Marquee

It’s Time To Call Out Fraud In The Adtech Ecosystem

By - January 26, 2013

A confusing landscape = ripe opportunities for fraud.

As part of research I’m doing both for the book and for my upcoming conference (the CM Summit, more on that soon), I’ve been in pretty extensive conversations lately with dozens of key players in the advertising technology industry. I find the ecosystem that has developed  to be fascinating, complex, and ripe with opportunity (and deeply important to the future of our society, not just marketing). I’ll be writing about it quite a bit in coming months. But before I do, I wanted to call out a growing issue that our industry will have to tackle sooner rather than later.

Just as in the early, wild west days of search (1999-2004), the programmatic advertising business – a multi-billion dollar marketplace growing faster than search, video, or anything else for that matter – is riddled with fraud.

That’s what many very reputable sources have told me in great length over the past few months. It’s something of an open secret, and more and more people are speaking out against it. Here’s Federated Media’s Walter Knapp on the problem, back in March of last year:

The great thing about the Internet is that it is built on the foundation of openness — from the way the domain system works to the way content and publishing are increasingly democratic. The core technologies embrace openness, sharing, linking and the ability to consume content across devices and across wired or wireless connections. Unfortunately, the openness we depend on in the digital media business is also available to people who can (and will) take advantage of this openness and exploit it for their own selfish wants.

Knapp notes two forms of fraud – ad injectors, fraudulent browser plugins that take over ad calls; and the practice of inserting an entire site into a 1×1 pixel hidden on high traffic but low quality sites featuring porn or music lyrics. Both are examples I’ve heard about over and over in my reporting. A third involves “stacking” ads one behind the other, all playing video to completion, often playing in inactive tabs. A fourth features refreshing ad calls on accelerated schedules or in inactive tabs. Yet another involves running as many ads as possible out of view, simply to gain “view through attribution” on a closed loop success metric.

More people are starting to call these practices out. AppNexus CEO Brian O’Kelly prominently featured the issue of fraud in his blog post celebrating his company’s recent $75 million funding, and what he intends to use it for:

Quality We will continue to invest in cleaning up the advertising marketplace. We’re proud of our anti-piracy stance, and our 5x volume growth this year indicates that you don’t need to serve on BitTorrent sites to be an ad platform company. We are investing heavily in fighting fraud, porn, malvertising, and malicious toolbars, and we are actively working on viewability tools.

Programmatic industry watcher AdExchanger puts it this way:

AppNexus’s pledge to invest money in ad quality issues is worth calling out. The issue is becoming more pervasive as companies emerge to exploit the vulnerabilities of real-time traded inventory to data and impression fraud, malvertising, and other nefarious practices. Fraudulent activities aside, the emergence of robust ad verification and viewability tools means display ad marketplaces and buying platforms must keep a clean nose.

It’s true that many folks are working on addressing the issue, including the IAB. But the bad actors are currently far ahead of the good guys, and worse, many in our industry are turning a blind eye, hoping the problem goes away in time, without too much publicity. Why? Well, nearly everyone gets paid from fraud – the publishers, the exchanges, the data providers, and the agencies. Even the marketers,who are footing the bill, feel like they are getting value – because the success metrics they’ve set up are being  met.

But fraud hurts the ecosystem in a massive way. It means that low quality, invisible, or purely fraudulent inventory is holding down the average value of the entire marketplace – hurting high quality, engaged publishers in the process, stunting investment in quality content.

Over and over, I hear that the reason CPMs (the amount of money a marketer is willing to pay for one thousand advertising impresssions) are so low is because “there’s infinite inventory.”

Hogwash. There’s only so much time in the day, and only so many pages where actual human beings are really paying attention, and the web (including mobile) is growing at a finite pace. There are even fewer places where marketers can be assured of quality, engagement, and appropriate context. It’s time we focus on identifying them, and ridding ourselves of the true source of “infinite inventory” – fraud.

Amazon is Amazin’ Me

By - January 17, 2013

I’m a fan of Amazon, always have been, though my relationship with the brand has, ironically, never been particularly personal. I don’t feel emotional about Amazon, I feel – transactional. This despite the fact that I have probably spent more on the site than the combined college savings accounts for my three kids (Hi Kids!).

This changed today when I got this email:

Holy. Crap. I just got given all those CDs I bought from Amazon, in a format I can use, for free. 1706 songs, to be exact, many of which I probably had forgotten about.

Now THAT is surprise and delight.This is how you leverage your past relationship with your customers to foster massive loyalty.

I read about this move, of course (it’s called AutoRip), and thought “Wow, that’s cool,” but then forgot about it.

This is the *exact opposite* of what I’ve come to expect from the music industry. With those chuckleheads, every time you change formats, you have to buy the music all over again. I have no idea how Amazon got them to play along with this, but I am sure as hell glad they did.

Now, I probably have most of this music already ripped to my iTunes, but I plan to download the whole lot of it anyway, because it’ll be way cleaner, with metadata and the like. So. Cool.

(Oh, but no, I don’t plan on using the Amazon Cloud Player. Yet. But I know that’s where you’re going with all this…)

With Google’s 2012 Zeitgeist, You Won’t Learn Much. Why?

By - December 13, 2012

Guess what? This guy was big this year. Really!

I think readers know that on balance, I’m a fan of Google. I recently switched to the Nexus 4 (more coming on that front as I settle into really using it). I believe the company has a stronger core philosophy than many of its rivals. Overall, given that it’s nearly impossible to avoid putting your data into someone’s cloud, I believe that Google is probably the best choice for any number of reasons.

But that doesn’t mean I won’t criticize the company. And every year about this time, I end up doing just that.

Because the annual Google Zeitgeist came out this week, and I’ve spent a bit of time digging into it. And once again, I’m pretty disappointed.

In the past I’ve criticized Google for failing to ask interesting questions of the massive amount of data it collects on search patterns each year. Once again, this lament applies. I honestly do not care what top ten TV Shows, Sports Stars, Songs, or even People we collectively care about, because there is *never* a surprise in those results.

But Google knows so much more….and could really tease out some insights if it cared to. Imagine if Google took its massive search query database and worked with some of the leaders in the open data movement to mine true insights? Sure, Google would have to be careful about how it released the data, but the output would be extraordinary, I’d warrant.

Instead, we find out that Gangnam Style was a big deal this year. No shit!?

But it gets worse. Not only is Zeitgeist rife with pop culture fluff, as you drill down into it by country, eager perhaps to find something interesting, it turns out Google has chosen to eliminate certain potentially sensitive categories altogether.

For the US and most other countries, for example, there is a “What is….” category, which shows the top search queries that start with “What is…” For the US, the answers are

  1. What is SOPA
  2. What is Scientology
  3. What is KONY
  4. What is Yolo
  5. What is Instagram
  6. What is Pinterest
  7. What is Lent
  8. What is Obamacare
  9. What is iCloud
  10. What is Planking

But is there a “What Is…” for Saudi Arabia? Nope. China? Uh-uh. The United Arab Emirates? No sir. Egypt? Move along.

Hmmm.

Oddly, Google did provide “What is…” was for Singapore, where people living under that “benign dictatorship” were interested in the same things as the US –  “What is SOPA”,  “What is Scientology” and, for politicians, who is “Mitt Romney.”

For the US only, you can drill down into all manners of other categories past the main page, including News, Science, Tech, Humanities, and Cities. Those are pretty interesting categories, but Google only provides them for the US, which is a shame.

Furthermore, I find it interesting that Google, with all of its translation technology, does not have a translation button on the results pages for countries where the majority of the searches are in languages other than English. This is most likely due to political sensitivities, because if you run some of the results through Google Translate (do you believe I had to do that?!), you get some stuff that I am sure does not please the regimes of countries like China, Saudi Arabia, and the UAE.

For example, here are some of the top searches for Saudi Arabia, translated (roughly I am sure) by the Google Translate service:

Student outcomes Arab Idol insurance Ramadan Series 2012 Mohamed Morsi explosion Riyadh Burma Free Syrian Army Shura Council tornado Sandy

But again, you aren’t going to get much more insight into what Saudi folks are *really* thinking about, because Google failed to ask the interesting questions, like those it has in the “News” section of the US Zeitgeist. I’d sure be interested in “Political Gaffes,” “Election Issues,” and “News Sources,” in Saudi Arabia, China, or the UAE.

In fact, for Saudi Arabia, Google has ommitted the “Top News Searches” box that is on several of the other country pages (even Egypt). Instead, the topics for Saudi Arabia (besides trending searches and people) focus on sports and entertainment stars, fashion designers, TV shows, and the like. Deep, Google. Thanks.

Now, the datasets are different for each country, and it may be that Google simply didn’t have enough trending data to surface interesting political insights for these controversial countries.

Somehow, though, I don’t buy that. This set of lists feels extremely human vetted – I’m guessing an awful lot of hand wringing went into chosing what to show and what might prove problematic to Google’s best interests were it to see the light of day.

If that is the case, I urge the company to have more courage. I bet if Google open sourced its query data sets (eliminating any chance of PII getting out, of course), I bet academics, data scientists, and just plain interested folks would let loose an explosion of insight. Pop up the rainbird of data, Google, and let the ecosystem flourish. We’d all be the richer for it.

As Long As It’s Legal, Corporations Will Act Selfishly

By - December 11, 2012

(image) There’s a hubbub in the press this week about Google employing a “Double Irish – Dutch Sandwich” tactic to funnel profits from Europe over to Bermuda, where there is no corporate income tax. Reuters reports that the company saved around $2 billion in taxes by employing the structure, which, as far as I can tell, is perfectly legal.

Of course, there’s a difference between that which is perfectly legal and that which seems, well, unseemly. Creating multiple shell companies across four nation states so as to avoid paying taxes may make shareholders happy, but it sure has pissed off a bunch of (revenue starved) countries in the EU. The article mentions the UK, France, and Italy as all investigating Google (and Facebook, among others) for potential abuse of the tax code.

To which I must say this: What else did you expect?!

Corporations will act exactly in their own best interest, period end of sentance. When it comes to saving billions of dollars, corporations won’t “do the right thing” or “step up and pay their fair share” – certainly not if there is *any* legal possibility that they can get away with avoiding doing so.

I very much doubt anything is going to change here, for any number of complicated reasons. The Irish have their own competitive reasons for ignoring US IP transfer law, the Dutch have similar reasons for allowing their corporate structures to exist. And Bermuda? Please. Google (and many other companies like it) is simply acting like a corporation – which at times feels like an excuse for a bunch of humans to act in very un-human like ways. Behold what we have created, and wonder.

Locked and Bloated

By - December 05, 2012

(image Vator News) Companies get big. Companies gain market dominance. Companies slowly pivot from their original values. Companies justify those shifts with nods to shareholder value, or consistent user experience, or inconsistent implementations of their platforms by (former) partners.

It happened to Sun. To Microsoft. To Apple. To Google. It happened in the entertainment business, it’s happening in agriculture, for goodness sake.  Now it’s happening to Facebook and Twitter. (The latest example: Instagram CEO feels Twitter card removal is the correct thing…).

I don’t have any problem with any of that, it is to be expected. The services all these companies provide are great. They’re simply wonderful. And as they get big, they get public, protective, and defensive.

I just wish these companies all had one thing consistently in common: That they let us get our data, our content, and ourselves out of their platforms if we wanted to, in a painless, one click fashion.

Imagine a world where that was possible.

A long, long time ago, at least in Internet years, I wrote a piece called It’s Time For Services on The Web to Compete On More Than Data. This was almost five years ago – January of 2008. I was contemplating the rise of Facebook and the social graph, and Google’s nascent response. In the post I argued that Facebook should let us all take our social graph wherever we want, because the company will win not on locking us in, but in servicing us better than anyone else.

Oh, how utopian that all sounds.

Now, pretty much every major Internet player is scrambling to lock us into a cloud commit conundrum. Even Twitter, in certain ways – it wants content viewed on its platform, not others’.

Again, imagine a world where coming and going as a consumer was a given, a right. Imagine that when I left Apple’s iPhone for Google’s Nexus 4, all my iTunes purchases followed me (and yes, I mean apps too). Is that too much to ask for? Really? Then you must not be an entrepreneur, because this kind of lock-in is ripe for disruption.

Five years ago, I predicted that Facebook would fail if it insisted on locking our social graph into its service:

With one move, Facebook can change the face (sorry) of this debate by making it falling-down easy to export your social graph. And I predict that it will.

Why? Because I think in the end, Facebook will win based on the services it provides for that data. Set the data free, and it will come back to roost wherever it’s best used. And if Facebook doesn’t win that race, well, it’ll lose over time anyway.

Time is ticking. It won’t be this year, it won’t be next. But the day will come when differentiation is based on service, not data lock in.

Dave Pell on Facebook’s Gift to Itself

By - November 28, 2012

I enjoy NextDraft, an email newsletter penned by Dave Pell each day. I value point of view and voice in any medium, and Dave’s got it. I think Searchblog readers would appreciate this item, so I’ve reposted it here. Dave, I hope you don’t mind…

The Gift of Data

Facebook knows a lot about you. But there are a couple things that would make its collection of personal data a whole lot more valuable: Your home address and your credit card number. In addition to having a big revenue potential, Facebook’s new birthday gift store could lead to a data treasure trove (and herald a new era when just typing “Happy Birthday” when prompted is no longer enough).

Facebook Is Now Making Its Own Weather

By - November 09, 2012

(image) The past month or so has seen the rise and fall of an interesting Internet tempest – the kind of story that gets widely picked up, then quickly amplified into storms of anger, then eventually dies down as the folks who care enough to dig into the facts figure out that the truth is somewhere outside the lines of the original headline-grabbing story.

The topic this time around centers on Facebook’s native ad unit called “Sponsored Stories,” and allegations that the company is gaming its “Edgerank” algorithm such that folks once accustomed to free promotion of their work on Facebook must now pay for that distribution.

Edgerank determines the posts you see in your Facebook newsfeed, and many sites noticed that sometime early this Fall, their traffic from Facebook shrank dramatically. Others claimed traffic had been declining since the Spring, but it wasn’t until this Fall that the story gained significant traction.

I’ve been watching all this play out – first via an angry post on the New York Observer site in which the author posits that Facebook is “broken on purpose” so as to harvest Sponsored Story revenue. An even angrier post on the same theme came five weeks later on a site called Dangerous Minds. From it:

Spring of 2012 was when bloggers, non-profits, indie bands, George Takei, community theaters, photographers, caterers, artists, mega-churches, high schools, tee-shirt vendors, campus coffee shops, art galleries, museums, charities, food trucks, and a near infinite variety of organizations; individuals from all walks of life; and businesses, both large and small, began to detect—for it was almost imperceptible at first—that the volume was getting turned down on their Facebook reach. Each post was now being seen only by a fraction of their total “fans” who would previously have seen them.

The author goes on to argue that Facebook was breaking the implicit contract between himself – an independent blogger – and Facebook, the corporation.

…as a publisher of a medium readership blog, I used to get a great deal from using Facebook—but I understood it to be a two-way reciprocal arrangement because I was driving traffic back to Facebook as well, and reinforcing their brand awareness with prominent widgets on our blog.

Now, if you’ve read my Thneeds post, you know I’m sympathetic to this point of view. I believe large social platforms like Facebook and Twitter “harvest” content from the Indpendent Web, and leverage the traffic and engagement that this content creates on their platforms to their own benefit via scaled advertising offerings. Most of us are fine with the deal – we promote our work on social sites, social sites drive traffic back to us. We like that traffic, either just because we like more folks reading our work, or, in the case of commercial sites like this one, because we serve ads against it.

Now, as I’ve noted many times over the past six months, this bargain is breaking down, because it’s getting harder and harder to monetize traffic using standard display advertising units. That’s not Facebook’s problem, per se, it’s ours. (See here for my suggestions as to how to solve it).

Nevertheless, for many sites, the spectre of losing significant traffic from Facebook means a serious blow to revenues. And from the point of view of the Dangerous Minds blogger, Facebook first cut his traffic off, then began asking him to pay to get it back (in the form of promoting his posts via Sponsored Stories).

This makes for a very good narrative: corporate greed laid bare. It got picked up by a lot of sites, including Ars Technica and even the aforementioned George Takei, who is upset that he’s lost the ability to push his posts to all 2.9 million of his Facebook fans.

Turns out, the truth is a lot more complicated. I’ve done some reporting on this issue, but not nearly as much as TechCrunch did. In a follow up to the Dangerous Minds story, TechCrunch claimed to have debunked the entire story. Titled Killing Rumors With Facts: No, Facebook Didn’t Decrease Page Feed Reach To Sell More Promoted Posts, the story argues that Facebook didn’t change its algorithms to drive up revenue, but rather to cull “spammy posts” from folks’ newsfeeds.

Facebook has always shown just a percentage of all possible posts in a given person’s newsfeed. Anyone paying attention already knew that. The company uses its Edgerank algorithm to determine what it thinks might be interesting to an individual, and sometime in the past few months, I can confirm through sources which wish to remain anonymous that Facebook made a pretty significant change to Edgerank that penalized posts that it felt were not high quality.

Of course, that begs the question: How does Facebook determine what “quality” is? The answer, in the main, is by measuring engagement – is the post shared, liked, clicked on, etc? If so, then it is seen as quality. If not, it’s demoted in value.

Is this sounding familiar to anyone yet? In short, Facebook just executed a Panda.

I held back from writing anything till this predictable cycle played out, because I had a theory, one that I believe is now confirmed: Facebook is now making its own weather, just like Google, and in the past couple months, we’ve witnessed the first widespread instance of a Facebook weather event.

For those of you who don’t know quite what I’m talking about, a bit of history. Ten or so years ago, the ecosystem around search began to notice shifts in how Google drove traffic around the web. Google would make a change to its algorithms, and all of a sudden some sites would see their traffic plummet (other sites sometimes saw the opposite occur). It seemed to those injured that the only way to get their Google traffic back was to buy Google AdWords – corporate greed laid bare. This story played out over and over, to the point where the weather events started to get names, just like hurricanes do. (The first was called Boston).

Early last year Google made a major change to its algorithms that penalized what it believed was lower quality content. Dubbed “Panda,” the changes targeted “content farms” that cranked out SEO friendly pages as AdWords bait. This had dramatic effects on many sites that specialized in “gaming” Google. It also hit sites that weren’t necessarily playing that game – updates like Panda often create collateral damage. Over time, and as it always does, Google fine-tuned Panda until the ecosystem stabilized.

I believe that Facebook is now learning how to manage its own weather. I don’t know the Dangerous Minds website well enough to know if it deserved the drop in traffic that occurred when Facebook had its Panda moment. But one thing does strike me as interesting to note: A significant drop in traffic means a particular site is losing audience that has proactively decided to click on a link inside their newsfeed. That click means the person leaves Facebook and goes to the the Dangerous Minds site. To me, that’s a pretty serious sign of engagement.

However, one might argue that such a signal is not as important to Facebook as internal ones such as “liking” or “sharing” across the Facebook network. To that end, I am sure we’ve not heard the last round of serious grumbling that Facebook is gaming its own Edgerank algorithm to benefit Facebook’s internal goals – to the detriment of the “rest of the web.” Be they publishers or folks like George Takei, who after all wants to push his Facebook fans to any  number of external links where they might buy his books or sign up to meet him at the next Comic Con, the rest of the web depends on “social traffic” from Facebook. The question is, should they optimize for that traffic, or will their efforts be nullified in the next Edgerank update?

Facebook is learning how to tread the delicate line between its own best interests, and those of its users – and the Internet That Is Not Facebook. Google does this every day – but it has a long history as a distributor of traffic off its main site. Facebook, not so much. Over time, the company will have to decide what kind of a relationship it wants to have with the “rest of the web.” It will probably have to start engaging more openly with its own ecosystem, providing guidance on best practices and how to avoid being penalized. This is a practice that took Google years to hone, and many still think the company has a lot of work to do.

Regardless, Facebook is now making its own weather. Now comes the fun part: Trying to predict it.

Tweets Belong To The User….And Words Are Complicated

By - September 06, 2012

(image GigaOm) Like many of you, I’ve been fascinated by the ongoing drama around Twitter over the past few months (and I’ve commented on part of it here, if you missed it). But to me, one of the most interesting aspects of Twitter’s evolution has gone mostly unnoticed: its ongoing legal battle with a Manhattan court over the legal status of tweets posted by an Occupy Wall St. protestor.

In this case, the State of New York is arguing that a tweet, once uttered, becomes essentially a public statement, stripped of any protections. The judge in the case concurs: In this Wired coverage, for example, he is quoted as writing “If you post a tweet, just like if you scream it out the window, there is no reasonable expectation of privacy.”

Twitter disagrees, based on its own Terms of Service, which state “what’s yours is yours – you own your Content.”

As the NYT puts it:

Twitter informed the (Occupy protestor) that the judge had ruled his words no longer belonged to him: (he) had turned them over to Twitter, in other words, to be spread across the world.

(Twitter’s) legal team appealed on Monday of last week. Tweets belong to the user, the company argued.

I find this line of argument compelling. Twitter is arguing that its users do not “turn over” their words to Twitter, instead, they license their utterances to the service, but retain rights of ownership, those rights remain with the person who tweets. It’s a classic digital argument – sure, my words are out there on Twitter, but those are a licensed  copy of my words. The words – the ineffable words –  are still *mine.*  I still have rights to them! One of those rights may well be privacy (interesting given Twitter’s public nature, but arguable), but I can imagine this builds a case for other ownership rights as well, such as the right to repurpose those words in other contexts.

If that is indeed the case, I can imagine a time in the not too distant future when people may want to extract some or all their tweets, and perhaps license them to others as well. Or, they may want to use a meta-service (there’s that idea again) which allows them to mix and mash their tweets in various ways, and into any number of different containers. Imagine for a minute that one of those meta services gets Very Big, and challenges Twitter on its own turf. Should that occur, well, the arguments made in this Manhattan case may well come into very sharp focus. And it’s just those kind of services that are nervous about where Twitter is going.

Just noodling it out. I may be missing some key legal concept here, but this strikes me as a potentially important precedent. I plan to speak with folks at Twitter about all this soon, and hopefully, I’ll have some clarity. Stay tuned.

Twitter Drops Other Shoe, Which You All Saw Coming, Right?

By - August 30, 2012

Way back in the spring of 2010, when Twitter was constantly under siege for “not having a business model,” I co-hosted “Chirp,” Twitter’s first (and I think only) developer conference. This was just two and half years ago, but it seems like a decade. But it was at that conference, in an interview with me, that then-COO (now CEO) Dick Costolo first laid out the vision for “the Interest Graph.” I wrote about this concept extensively (herehere, here), because I felt that understanding the interests of its users would be the core driver of Twitter’s long-term monetization strategy.

Fast forward to now. Twitter today announced its “promoted” suite of ad units may now be targeted by user interest, which to me is a long-expected move that should clarify to anyone confused by the company’s recent announcements (cue link to recent tempest). Twitter’s statements around its decision to sever ties with Instagram and Tumblr couldn’t be more clear:

We understand that there’s great value associated with Twitter’s follow graph data, and we can confirm that it is no longer available to (insert company here)…

In short, if you are a potential competitor, and have the resources, motivation, and potential to harvest the connections between Twitter users at scale, well, expect to get cut off. You’re a threat to Twitter’s revenue stream.

None of this should come as a surprise, if you’ve been paying attention. Back in 2010, the second autocomplete answer for the statement “I don’t get…” in Google was “I don’t get Twitter”:

Interestingly, today, the same search today shows Twitter has only managed to drop down to third, even though the company now sports 140 million active users:

And while one could argue that in 2010, it was consumers who didn’t “get” Twitter, perhaps the folks scratching their heads via Google now are developers, who of late have been concerned that building on top of Twitter’s APIs might be dangerous for their long-term livelihood.

Twitter’s announcement today clarifies things quite a bit. Twitter has already declared its distaste for any business that manages how people consume tweets. Today, the other shoe dropped: Don’t build your business leveraging Twitter if you plan to run interest-based advertising at scale. Of course, the entire traditional media business is driven by interest-based advertising, which means Twitter’s business development group has a lot of work ahead. Interesting times ahead, to be sure.