Does anyone remember AOL?
I’m not talking about the AOL that is scrambling to stay competitive but the AOL of a decade ago that was, in many respects, the Web for millions of people.
AOL created a user-friendly online ecosystem that met all your needs – email, content, services and, of course, access to the Internet (albeit via dial-up). It was a wonderful walled garden that meant there was really no need to wander out into the Wild Web. For AOL, it was a lucrative business. For AOL customers, it was Web Lite: convenient, easy to use and understand but dull given all the exciting things happening on the Web.
In the end, AOL’s walled garden became irrelevant as people discovered the Web had so much more to offer than the limited view offered by AOL. It was a great ride but AOL’s efforts to be all things to all people came to an abrupt end as consumers sought more choice and freedom.
So, what’s the connection between Facebook and AOL?
The key link is Facebook’s growing ambitions to be the destination for its 550 million users. By launching new services such as Places, Deals and e-mail (and offering an option to make Facebook your http://techcrunch.com/2010/11/21/facebook-homepage/), Facebook wants its users to spend most, if not all, of their time in Facebook. This is above and beyond the 5.5 hours/month the average Facebook already spends on Facebook.
While offering more services makes Facebook a more multi-dimensional service, it is also starting to make Facebook more complicated and confusing. From its roots as a service to communicate and share with friends and family, Facebook now wants to be a lot more. In fact, you could argue it wants to be everything.
It begs the question: what is Facebook and what is its role?
The big danger for Facebook is as it drives to become all things to all people, it risks becoming a cluttered landscape that will start to suffer from offering too many choices. It’s sort of like going to eat at a restaurant with a menu that goes on and on and on. While there are lots of options, making a decision is a major challenge.
And as Facebook looks to offer every popular service, it threatens to becoming a good, but not great, at any of them. At the same time, its users could start to feel that Facebook is trying to be too much, which could drive them to other services as a way to keep control.
Maybe this is just a small indicator but a blog post on TechCrunch by Jon Evans caught my attention because it’s a influential voice taking a serious poke at Goliath – something I haven’t seen enough of amid Facebook’s tremendous growth.
“I dislike Facebook because they’re mediocre. They have a platform and opportunity unlike anyone else, ever—and what have they done with it? Nothing. None of their so-called innovations are actually even remotely so. Copying Twitter was smart, but hardly new; ditto Foursquare. They called Facebook Groups an innovation; it’s a basic feature they should have implemented years ago. Now they’re laughably trying to claim that integrating email into their messaging system is a world-shaking revolution.”
Any way you want to slice it, Evans is making a pretty cutting statement that I think reflects the concerns many people may have about Facebook but reluctant to publicly express. Let’s face it, Facebook is a good service but far from perfect.
The more Facebook attempts to become a bigger part of your online existence, the more concerned you should get because there’s a danger in being too tied and too connected with a single service that wants to know more of who you are and what you do. It’s the same reason why people should be cautious of tying themselves to tightly to Google and all the services it offers.
Despite Facebook’s growth, I have always been ambivalent about it. Facebook can’t be ignored because it has become too popular and useful as a communications and marketing vehicle. At the same time, it is important to remember Facebook has aggressive ambitions that may not always align with the needs or wants of its users.
At one time, AOL seemed unstoppable and invulnerable because it was so big and dominant. But that strong position didn’t last because as AOL pushed forward to hammer home its dominance, the online landscape shifted on it, and users found different and better ways to use the Web.
I’m not suggesting Facebook faces the same fate but the similarities can’t be ignored or denied.
Facebook Groups, and why they Rock
[...] Is Facebook the New AOL? | Mark Evans Tech [...]
Is Facebook the New AOL? | Mark Evans Tech – facie spaces
[...] http://www.markevanstech.com/2010/11/27/is-facebook-the-new-aol/ Categories: Facebook 27 November 2010 at 12:46 – Comments [...]
Interesting read. I agree that Facebook has become Portal 2.0. Although I think re social graph definitely changes things. People were hesitant to leave AOL/Yahoo and all they had invested was habit and maybe an email address.
With so much personal info invested into FB, I think it will take a long time (and much better competition) to see a reverse in growth for Facebook. The social graph certainly changes things.
In the meantime, I’ll continue to passively use Facebook as my social inbox for updates from friends/family and frequently use sites like Twitter, YouTube, Posterous, etc that do one thing exceptionally well.
John,
I’m taking the same approach as you; using Facebook for some, but not all, things. Even then, it has a limited role.
Mark
I use Facebook and sites like Twitter for different things and to communicate with different groups of friends in different ways so I think there will always be room for other websites. From a financial standpoint though, its interesting to see where Facebook is and where Facebook might be headed. I definitely see Facebook trampling on Google’s footsteps in the advertising realm. Social media is so important to businesses that they’re even trying to buy fans on sites like GetMorePopular. Still, AOL ultimately failed at this for multiple reasons, but one large reason is that AOL management was and is completely incompetent. Facebook doesn’t share this problem so they will rule the web2.0 roost for some time to come.
Forgot to end your bold formatting? Nice post, I think you’re right. I think facebook runs the risk of becoming boring and having a sudden drop.
Great post Mark,
It’s interesting that last year around this time Google was the tech darling and seemed to be doing no wrong, rolling out product after product, and entering into the wireless game. I remember thinking that Google Wave would change the world.
And now, after a summer in “lockdown”, Facebook is iterating at a dizzying pace and layering its platform right onto the entire web. And while I think their Open Graph is transformative in many respects, for it to develop into your online passport, the activities of its users outside of the walled garden have to be monitored. That requires the help of third parities, which to a certain extent they have no problem getting. But Google may still have something to say about that.
Even then, I think the Social Graph isn’t necessarily about what your friend’s (strong ties) are doing. It’s also about how you interact with weak ties, people or objects that pass through your life on and offline. This tends to happen somewhere else other than Facebook, and these interactions prove to be richer sources of information. So the move to be a one-stop shop for your web experience is far too ambitious in my opinion. As you mention with the AOL case study, that kind of growth may ultimately be self-defeating because it’s ultimately unfocused.
The question you raise is what 2011 may largely be about: What is Facebook trying to become, and, will it make sense a year from now?
It’s going to be interesting to see how it plays out.
Ron,
Thanks for the insight and thoughts. It will be interesting to see if Facebook continues its fast pace of growth in 2011, as well as its expanding feature empire!
Mark
The walled garden approach failed before and will fail again. Long live the web. However, I do think Facebook’s web interface is ahead of the curve. The reason it is so popular is because it is easy to use and it does what you want. It’s not perfect and better products will pop up, no doubt. One could say the same thing about the iPhone as a platform.
Funny, I asked Steve Case this very question two weeks ago. (in person, in Honolulu.)
Interesting take on Facebook’s lack of true innovation, but your analogy to Aol is way off the mark.
Aol initially succeeded because it provided an intuitive interface (like Facebook) that drew people to its true revenue source- its dial-up business (unlike Facebook). At the time (mid-nineties or so), people were just starting to discover the “web” and among all the companies providing a connection to said “web”, Aol’s solution was the only one that seemed to ‘just work’ to the average person. Its simplicity and ease-of-use made it the conduit of choice through which people connected to the internet, but at no time was its wealth of services and highly developed interface meant to stand on its own as a separate business unit. The interface was, in a sense, a marketing strategy for Aol’s vanilla dial-up service — nothing more.
Aol’s business model called specifically for drawing in user’s and locking them into their dial-up business model. Facebook, quite to the contrary, exists solely for the services it and third party developers provide- if users see no value in what is offered, they will stop coming to the site. This stands in direct contrast to Aol, where even if a user failed to see the value in the Aol interface, he still needed to use it to connect to the internet.
Aol prospered and later fell by its focus on an easily-commoditized technology (dial-up), while Facebook’s future will be written on its ability to enhance its role at the center of interpersonal communications.
The analogy with AOL really is off the mark. The fact that people kept using various AOL services (especially IM, email and their web portal) after moving on from their then-obsolete ISP suggests that there wasn’t anything in particular about its online product that was driving people away.
The features Facebook is implementing now are pretty basic – like someone else said, things like Groups and Email are features that really should’ve been there a long time ago. That is to say, there’s nothing about what Facebook has been introducing lately that’s really all that sprawling; they’re simply iterating and improving the core communication and identity functions that it’s always been used for.
There have been a couple features (most notably Questions) that really didn’t achieve much in this direction, but those still seem like the exception and not the trend of where Facebook is going.
I’ve been thinking the exact same thing. But here is why they do it.
They do it to boost they’re hits. Which in turn means more page views for ad’s.
Hits are also great talking points at investment meetings.
“Look at how many hits we have” “Look at all this data” “target this and target that”
Which turns into more misled people giving facebook money. Because they believe there is some monetary value in facebook. How many times have you clicked on an ad in facebook? I have never clicked on one. I assume not many people do. When we log into facebook, we may send a message, upload some photos, even comment on our friends pages. We don’t login to find the latest deals, or find which movies are playing in our area. How many times have you clicked the X only to find there is yet another advertising tool aimed at showing you more relevant ads.
So if we don’t click on the ad’s that means advertisers are paying for nothing. Unless facebook is showing how many page views they have. If half a million people add facebook at their homepage, imagine how the page views will look to advertisers. They’re be drooling with cash in hand.
Facebook was once a tool used to connect with friends.
Now facebook is also a tool used for companies to further target users for advertisements.
Remember, if you aren’t paying for a service…You’re the product being sold.
Advertisers aren’t stupid, especially not online advertisers who can measure ad data in remarkable detail on Facebook (and just about any other website). If the system didn’t work, they wouldn’t use it, no matter how big the traffic numbers are. The suggestion that Facebook monetizes by duping advertisers is ridiculous given the scope of its widely reported revenue growth.
And it’s naive to complain about Facebook making money by targeting you ads given that this is the business model behind almost all of the free web. As long as Facebook doesn’t do anything deceptive or misleading with its targeting and use of your data (which is definitely something to watch them on), you really have nothing to complain about if you aren’t paying them to use their service. Or just about anyone else’s on the web.
Hey Mark
I’ve been saying this in private for months now; except instead of AOL, Facebook is reminding me more and more of CompuServe (which of course was bought and merged with AOL) without the ISP aspect.
Eleven Tech Trends To Watch In 2011 – Stephen Foskett, Pack Rat
[...] boasting a quarter of all web pageviews. Facebook is looking increasingly like AOL for the rest of us. 2011 will see Facebook’s gravity pull in content from everywhere, and its [...]
Agreed and great post Mark. I started saying this late last year as well – http://www.smarterfaster.com/?p=1866 (although not as eloquently as you have here). Having lived through it as well, I love the analogy from Mike Allen to CompuServe. In this day of micro-specialization, FB will have a tough time trying to be the portal that offers every service to every user.
Jack of All Trades: Master of None « Office Binary
[...] question you this. Why did Aol fail? Because it tried to be everything for everyone (see http://www.markevanstech.com/2010/11/27/is-facebook-the-new-aol/). It has in the past year, tried to take over your email, your web-browser, your movie rental, your [...]