In February 2004, whilst at Harvard, Mark Zuckerberg and friends created "The Facebook". What started as just a website for one university spread through academic institutions, developed into an application platform, and then became an entire web ecosystem. It has become one of the dominant forces on the internet in the early 21st century.
The simple idea of connecting people together into networks of friends sharing their personal details has made Mark Zuckerberg, on paper at least, one of the wealthiest men on the planet. Despite his nationality and computer geek background, in 2011 the Guardian named him as the most influential person in the UK's media. This is the story of the rise and rise of Facebook, as told in six years of original journalism, writing and comment in the pages of the Guardian and the Observer.
Facebook: The Rise and Rise of a social media giant is available for Kindle priced at £2.56 and as an iBook for £2.99.
We'll look at the other side of the coin in a moment, but first let's give credit where it's due and admire the obverse: I'm delighted to see Facebook going public, just deserts for Mark Zuckerberg and his group of very smart techies.If you have the time and inclination, take a walk through Facebook's SEC S-1 filing in preparation for its IPO – you won't regret it. Pay particular attention to the manifesto Zuckerberg calls The Hacker Way and allow this ageing geek (I'll soon be 28) to sing its praises. Consider this verse:
We have a saying: "Move fast and break things." The idea is that if you never break anything, you're probably not moving fast enough.
Where others have stumbled as they shuffled, Zuckerberg and his gang have raced to create a technical giant. The infrastructure required to support 845 million "monthly active" users that upload 250m photos each day might not be Google-sized (yet), but it's definitely Google-class.
To show off this plumbing, Zuckerberg & Co. took a few pages from Apple's (and Google's) stylebook: They stuck to a simple, clean UI – unlike Myspace and its pavement pizza chic.
Facebook's success isn't just a sweet retort to Zuckerberg's critics, it's a confirmation of what makes Silicon Valley tick: techies, geeks, and nerds. While the technoïds aren't always right – far from it – the great ones end up making and running great companies.
The establishment bluestockings may roll their eyes at the hoodies and bare feet, but look at what happens when the suits take over. Look at HP, Yahoo, or Cisco; regard Apple during its dark age.
It wasn't very long ago, I recall gleefully, that the kommentariat cluck-clucked disapprovingly over the founder's "obvious'' immaturity, his tactless management style, his poor public-speaking manner. But when you read Facebook's S1, you'll realise how good a negotiator Zuckerberg must have been early on.
Since its inception, the company has raised about $1.5bn (£952m), an unusually large amount for a startup, and well above the threshold that usually translates into management castration as investors demand a bigger share of the spoils, ransom for their assumption of greater risk.
Instead, Zuckerberg got investors to go for the radius of the pizza as opposed to the angle of the slice, their ownership percentage. Zuckerberg may own "only" 28% of Facebook, but he manufactured agreements that give him effective control of the company with 57% of voting rights.
Some will downplay the achievement: "He must have gotten good advice." Of course … but he followed it. When you're in charge, the quality of the advice is no excuse for bad performance; conversely, good advice shouldn't be used to dismiss good results.
Speaking of which, in 2011, the company's revenue was $3.7bn, with a tidy $1bn profit and $3.8bn in cash – to which they'll be adding at least $5bn in the upcoming IPO. This is a nicely profitable company.
The Washington Post's Wonkblog put Facebook's performance in graphic perspective:
Take a look at the number of employees: a mere 3,200. With $3.7bn in revenue, that works out to $1.2m per worker. Turning to cash per worker ($3.9bn/3,200=$1.2m), Facebook is about as rich as Uncle Apple's $1.3m cash per "full-time equivalent" employee. It's a remarkable achievement for any company, and unheard of for one so young.
But it's not all roses.
As Zuckerberg's Letter To Investors properly contends, Facebook can "change how people relate to their governments and social institutions" and "improve how people connect to businesses and the economy".
Making tons of money in the process is totally legit … as long as a key condition is met: informed consent. And "informed consent" mean just that: information that a reasonably attentive individual – as opposed to an Apple patent attorney – can understand.
On this count, Facebook's actions have been less than transparent. Perhaps it's a consequence of the Hacker Way: ship first, ask questions later. Or perhaps Facebook is betting we're too lazy and ignorant to read the fine print, just like wireless carriers who try to dazzle us with their sleight-of-plan hoodwinks.
Furthermore, Facebook's ubiquity and power raises the spectre of yet another Walled Garden: is Zuckerberg's company killing the Open Web by superimposing a proprietary lattice of connections between users, including companies that use Facebook to do business with its community?
Many have noted that Google can't really index the Facebook web. As John Batelle puts it:
Sure, Google can crawl Facebook's "public pages," but those represent a tiny fraction of the "pages" on Facebook, and are not informed by the crucial signals of identity and relationship which give those pages meaning.
(True. But does Google want to index Facebook? Behind the Open posture stands Google's real aim: bulldozing anything and anyone standing between their ad engines and their targets.)
Lastly, let's consider the Web 2.0 proverb: if the product is free, you are the product. With that in mind, I couldn't help wince at the opening of Zuckerberg's Letter To Investors: THEORY -.-)
Facebook was not originally created to be a company. It was built to accomplish a social mission – to make the world more open and connected.
It reminded me of the Don't Be Evil puffery in Google's own S-1:
Don't be evil. We believe strongly that in the long term, we will be better served – as shareholders and in all other ways – by a company that does good things for the world even if we forgo short-term gains. This is an important aspect of our culture and is broadly shared within the company.
When I read those words back in 2004, I thought Google was either incredibly naive or a little too obvious in its do-good posture. Either way, we know what has happened: Google needs to be all things to all people, all the time, everywhere, on every device, in order to irradiate us with its advertising photons. Google's motto should be Disintermediation R'Us. Instead, its mission statement reads:
Organise the world's information and make it universally accessible and useful.
… all in the name of selling ads.
In his letter, Zuckerberg comes up with a similarly lofty sentiment:
There is a huge need and a huge opportunity to get everyone in the world connected, to give everyone a voice and to help transform society for the future.
I don't mean to diminish Zuckerberg's accomplishments. He's built an epoch-making company, I'm delighted by the team of highly skilled technologists he's assembled – a team that includes some dear friends of mine – and the tech culture they evince.
He's surrounded himself with sharp business people and extracted oodles of money from strong investors; he's Bill Gates/Larry Ellison/Page+Brin caliber or above … and I'm thrilled to see the former naysayers now eating out of his hand.
So why not just say something like:
We help people connect in safe, convenient and innovative ways. In doing so, we've built a business of historic proportions. We make money selling advertising that is finely tuned to reach our users in cost-competitive ways. Because we believe in Facebook's unlimited potential, we will manage ourselves for the long term rather than for short-term profit. We have built an ownership and control structure to accomplish this goal.
There's good evidence that the people who buy Amazon, Google and Facebook shares are willing to let these companies run for the long term rather than for the next quarter. Smart people don't need lofty mission statements to guide their investments, they watch what the execs do and decide if they're using "the long term" as an excuse or if they're really aiming for it.
Apple's iPad similarly re-defined the market for tablet computers, and then dominated it, a host of Android-powered competitors following in its wake. Apple had already released the iPad 2 by the time RIM offered its response, the tablet Lazaridis held in his hands. It represented a bold transition for the company, replacing its aging OS with one based on QNX, which it had acquired in 2010. With the declaration "amateur hour is over," it promised to bring enterprise-level functionality to what had previously been a consumer market. Apple had made the smartphone a consumer device; RIM decided it would make the tablet an enterprise device. That was the hope, anyway. Surrounded by a lackluster selection of new BlackBerrys and despite being hampered by delays, the PlayBook offered one glimmer of excitement in the company's portfolio.
Coincident with the product woes, employee morale took a hit in July, when the company announced layoffs of 2,000 employees, 10.5 percent of the total workforce: a "cost optimization program." Hiring had been so fast and furious that the move returned RIM to roughly the size it'd been earlier in the year; the company noted that its rapid growth meant "the workforce had nearly quadrupled in the last five years alone." Not only were the layoffs an ominous sign, but digging deeper, it was obvious RIM had brought on thousands of new employees only to lay off an equal number months later. That didn't cast a positive light on its long-term strategies.
TA :
Video containing information about the Apple specification, including how it has been improved over the year , including the ios5 , and the has been camera updated to 8 megapixel . As well as this it has an integrated app which allows you to speak into the microphone and the instructions come up quite easily , such as making an apple pie :p . This allows more audience freedom in terms of what they use the phone for .
8. What are the political and social implications of the new technologies and the methods of their consumption? E.g. moral panics etc?
Young people and social networking services - not another moral panic
By Steve O'Hear | June 20, 2008, 8:16am PDT
Summary: A new UK-focussed report published by Childnet International aims to support teachers and lecturers who wish to explore the use of social networking services by young people. In this guest post, Josie Fraser, one of the report’s authors, explains more.
A new UK-focussed report published by Childnet International aims to support teachers and lecturers who wish to explore the use of social networking services by young people. In this guest post, Josie Fraser, the report’s author, explains more.
That social networking services have and are continuing to reconfigure the online landscape will come as no surprise to ZDNet readers. Social networking services have become increasingly important to how many children and young people spend and organise their social time, often replacing that previously spent in front of the television. Increasingly, tools and practices that may have been treated with suspicion or seen as a waste of time by schools and local authorities – and subsequently banned or ignored - are being explored within education.
Cyberbullying and e-safety concerns have primarily driven the need for adults with a responsibility of care to get savvy about services, but the potential positive impacts of social media are beginning to sink in. Signaling a more balanced approach which looks beyond the frequent moral-panic inducing stories is Childnet International’s new report, Young People and Social Networking Services, commissioned by Becta, the UK Government’s lead agency for information and communications technology (ICT) in education. Social networking services provide a range of potential formal and informal educational opportunities for young people. While educational technologists and enthusiastic teaching staff have been quick to understand the potential benefits, as well as the risks, in using all kinds of social software in and out of the classroom, e-safety and digital literacy is still an emerging area, with blocking and filtering practices within school networks sometimes preventing not only staff development and awareness, but in dealing effectively and quickly with risky or bullying behaviour.
Childnet’s report outlines some of the potential benefits of using a range of services, and looks at how they can provide an accessible and powerful platform for developing young people’s voices, and an easy way to taking part in local and international communities and activities. The report looks at the benefits of services which enable young people to become content creators, managers and distributors, as well as pointing out the data management and digital rights issues that these raise.
Social networking services are broadly defined within the paper and include those that are profile focused (Bebo, MySpace, Facebook), content focused sites (YouTube, Flickr, last.fm), virtual worlds, mobile sites, and microblogging. All these sites offer users the opportunity to create a profile of sorts, and to make connections with other users. They all also fundamentally rely on active participation –making, uploading, writing, commenting, reviewing and organising. These are all practices that can support creativity, collaboration and teamwork – and critically, skills and processes that are going to help prepare young people for the adult world. Exploring online communities and worlds can help develop key, real world skills.
Online spaces are social spaces and social networking services offer similar opportunities to offline social spaces to young people – places to be with friends or to explore alone, building independence and developing the skills they need to recognise and manage risk, to learn to judge and evaluate situations and to deal effectively with a world that can sometimes be dangerous or hostile. However, such skills can’t be built in isolation, and are more likely to develop if supported.
The report looks at some of the issues preventing educators from exploring social networking services – these include levels of educators’ confidence and experience, and on-site blocking and filtering policies. The lack of a sensible risk management approach to working with students online is also drawn attention to.
The report also outlines some of the hazards of using social networking services, not all of which are exclusive to young people. Harmful and potentially illegal content and activities are reviewed, including impersonation and identity theft, grooming, and cyberbullying.
Being able to manage data – especially personal information - online is a new key skill, but many young people’s online interaction can be characterised by what researchers have called “imagined communities”. This belief that the information, pictures and content that you publicly post is mysteriously visible only to yourself and to people you would chose to have access to it. Many people are just not considering that public data can be searched and that it remains accessible for a long time. The increasing use of universities, employers, and more recently the police, to look for information about individuals on social networks needs to be more widely understood and the potentially far reaching impact needs to be recognised. Data management and privacy issues have become key digital literacy and e-safety areas – of course these aren’t confined to social networking services, but these are the contexts within which we are talking to our friends and the world – and posting pictures - about what it was we got up to last night.
Digital literacy support is also useful when it comes to other risks that young people might be exposed to online. The impact of types of cyberbullying can sometimes be underestimated or misunderstood by young people. Schools have a responsibility to ensure that young people understand how some activities can be hurtful to others, and that young people know how to look after themselves online. We wouldn’t let a child go off on their own to a park or town centre without first making sure that they knew how to keep themselves safe and how to respond to danger. Many adults seem to believe that the current generation has been born with an innate ability to fend for themselves online. While they may pick up how to access services quickly, safe and acceptable behaviour is still something children need support and encouragement with – offline or on.
The report aims to bring together the wide range of information about where education currently stands in regard to social networking services. In addition to looking at the advantages and dangers of using social networking services, the report spends some time on reviewing what social networking services are – recognising that many of its audience will not have a clear overview and understanding of this rapidly developing field. Several major service providers also supported the report – including Bebo, Facebook, Google and Yahoo! to help produce an evaluation chart to equip schools with a way to work out the differences between services, and to help them both understand and use services appropriately. There is also an ideas and examples section that highlights examples of how services are currently being used within education.
As well as contributing to an understanding of current practice, the report aims to bring Local Authorities and school leaders up to speed so that they can consider current policies and practices and take the next step. Since so many of our children, young people, teachers and parents are already using social networking services in one form or another, we need to be asking (at least) two new questions: how can we ensure the education and support we provide is relevant to problems they might come across within these environments, and how can we utilise or engage with services in safe, creative, and effective ways?
Josie Fraser is a freelance Social and Educational Technologist, who focuses on the use of technology for community engagement and learning. She previously worked with Childnet International delivering the UK Governments’ Cyberbullying Guidance for schools, and led the Young People and Social Networking project. Josie blogs over at SocialTech and you an follow her on Twitter.
Guardian Article
Six of the world's top consumer technology companies – including Apple, Google and Microsoft – have agreed that apps will provide greater privacy disclosures before users download them so as to protect consumers' personal data, California's attorney general said on Wednesday.The move comes amid increasing criticism over "data grabs" by a number of third-party applications which don't offer clear disclosure about how much of a user's personal data such as their address book they will store on their servers.
Google also came under renewed scrutiny over its announcement earlier in February that it would streamline its privacy policy, and still faces separate scrutiny from the US Congress over its circumvention of security settings in browsers to track millions of users of its services on Apple's iPhone and iPad, and users of Microsoft's Internet Explorer browser.
The new agreement binds Amazon, Apple, Google, Microsoft, BlackBerry-maker Research in Motion (RIM), and Hewlett-Packard – and developers on their platforms – to disclose how they use private data before an app may be downloaded, Attorney General Kamala Harris said.
"Your personal privacy should not be the cost of using mobile apps, but all too often it is," Harris said.
She said that 22 of the 30 most downloaded apps do not have privacy notices. Some downloaded apps also upload some or all of a consumer's contact book to online servers – including small companies such as the would-be social network Path, and the giant microblogging network Twitter.
The importance of reining in wayward apps has become urgent: there are nearly 600,000 applications on offer in the Apple App Store and 400,000 in Google's Android Market, and consumers have downloaded more than 35bn, Harris said.
She said there are also more than 50,000 individual developers who have created the mobile apps available for download on the leading platforms.
Harris said an estimated 98bn mobile applications will be downloaded by 2015, and the $6.8bn (£4.3bn) market for mobile applications is expected to grow to $25bn within four years.
Google said that under the California agreement, users of its Android mobile operating system will have even more ways to make informed decisions when it comes to their privacy. Apple confirmed the agreement but did not elaborate.
Harris was also among US state lawmakers who on Wednesday signed a letter to Google chief executive Larry Page to express serious concerns over the web giant's recent decision to consolidate its privacy policy.
The policy change would give Google access to user information across its products, such as GMail and Google Plus, without the proper ability for consumers to opt out, said the 36 US attorneys general in their letter. EU authorities have asked Google to halt the policy change until regulators can investigate the matter.
Meanwhile the US's Electronic Frontier Foundation (EFF) has put up a page explaining how people can wipe clean their Google Search History before the changes take effect on 1 March. But it noted that this will not prevent some tracking.
California's 2004 Online Privacy Protection Act requires privacy disclosures, but Harris said few mobile developers had paid attention to the law in recent years because of confusion over whether it applied to mobile apps.
"Most mobile apps make no effort to inform users about how personal information is used," Harris said at a press conference in San Francisco. "The consumer should be informed of what they are giving up."
The six companies will meet the attorney general in six months to assess compliance among their developers. But Harris acknowledged that there was no clear timeline to begin enforcement.
The attorney general repeatedly raised the possibility of litigation at some future time under California's unfair competition and false advertising laws if developers continue to publish apps without privacy notices.
"We can sue and we will sue," she said, adding that she hoped the industry would act in good faith.
We must fashion a new media landscape
Murdoch may be down but he's not out. His companies can't be allowed to dominate – and neither can the BBC
A year or two before the phone-hacking scandal engulfed News International I was one of a small group who interviewed Rupert Murdoch in New York. At the time I was chairman of the House of Lords communications committee and, unlike some we interviewed, Murdoch set out with clarity just how he saw his role as a newspaper proprietor.As far as the Times and Sunday Times were concerned he was hands off. He was prevented by the terms that the government had laid down in the 1981 takeover from taking any part in the policymaking of the two newspapers. He claimed (although obviously this can be challenged) that those were the rules he had followed ever since.
When it came to the Sun and the News of the World, however, he was brutally frank. He made no secret of his power. He was the "traditional proprietor" exercising editorial control on major issues such as which party to back in a general election or policy on Europe.
Since then of course the News of the World has died and the Sun on Sunday will rise in a few days to take its place. But Murdoch remains the traditional proprietor. From his New York headquarters he will continue to have his say in the politics of the United Kingdom – and make no mistake, there will be politicians who will play along with this.
There will be nothing as obvious as special trips to talk to the company's executives, but the political parties will want the Murdoch press on their side. There were always politicians who (at least until the Milly Dowler case) wondered aloud what all the fuss was about. It will take very little for them to restore relations particularly as News International skilfully portrays the Sun as engaged in a brave fightback after some rough treatment at the hands of the police.
So we are back to where some of us began. Last summer we were within days of the culture secretary waving through the Murdoch bid to take full control of BSkyB and claiming that phone hacking was an entirely separate and irrelevant issue. That fate has been avoided, but the challenge remains to devise a system where nobody – Murdoch or anybody else – has a disproportionate share of the British media.
One step is obvious. Politicians should be removed absolutely from the decision-making process. The final decision in a media takeover should be taken by an independent body like the Competition Commission or Ofcom, and not by a politician.
So what is a disproportionate share of the media market? Four newspapers controlling almost 40% of national press circulation and total control of a major television company would have put Murdoch the wrong side of the line.
But what about the BBC with its plethora of television channels and multitude of radio stations and programmes? Surely the corporation has a massive political influence, for why else would cabinet and shadow cabinet ministers queue up to be interviewed on Today or Andrew Marr's Sunday programme?
As it happens my own view would be that BBC reporting is some of the best in the world, but that is not how everybody sees it. As a veteran of both Margaret Thatcher's cabinet and John Major's central office I can attest to the fact that it was not regarded as an incontestable truth. Any new rules on share of voice cannot be directed exclusively at News International. The BBC must come within the net as too must the other media giants like Google.
Not that all the solutions need to be restrictive. The BBC for example faces stiff competition on all its television channels. The same however is not true for national news radio. Today, World at One and PM have a far too clear run. That kind of radio programme cannot be supported by advertising, but of course the BBC has the licence fee. One solution here is to make a portion of the licence fee contestable so that a new provider like ITN or Channel 4 can be attracted in to compete.
The more difficult question concerns how share of market will be measured. Should it be based on circulation and audience figure, or would a more sensible measure be financial?
In any case, ministers might now reflect that the whole controversy on ownership could have been avoided. The regulations on takeovers of television companies in the United States preclude any foreign company from taking anything but a minority stake in an American channel. For years the position of successive British governments was that the same restriction would apply to American companies unless there were new reciprocal arrangements between the two countries.
The US never showed the slightest interest in changing its position, but overnight in 2003 – at the very last stages of the communications bill – the Blair government threw in the towel. Britain abandoned its defences unilaterally and a grateful Murdoch was presented with his opportunity. It will be fascinating to see whether the coalition government has the courage to reverse that decision. We will see whether the world has really changed.
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