The latest developments at Facebook – recently captured in this New York Times article – are just the latest and most prominent example of the awkward evolution of the internet. Apparently, Facebook has given in – at least to some extent – to the vociferous critics of its new advertising program, which sends details on personal web surfing to your Facebook “friends.” There will now be an individual opt-out function available to users before any emails are sent to any friends  – though it will have to be repeated every time. But beyond the details of this marketing dust-up, it’s interesting  to note the salience of several recurring themes in the protean Web 2.0 environment:

  • It’s easy enough to create a popular website, network or application…but another thing altogether to figure out a way to make money on a sustained basis. Facebook’s introduction of the Beacon advertising tool is an attempt to “monetize” its huge user group. The jury is still out.
  • Though evidence suggests peer-to-peer references are paramount in individual purchase decisions, they need to be transparent and credible to have any traction. Facebook’s twisted version of a friendly referral – your friends are alerted if you frequent a website… likely assuming you are tipping them off to a great bargain, yet all it means is that you visited said website – does not pass the sniff test for most users.  
  • The will of the community – the millions of users on websites or networks – continues to be a driving force in shaping the rules and format of web properties. It’s clear companies cannot afford to ignore user input or suggestions, but Facebook has shown you can survive with some compromise and without abdicating to user demands. That said, they are playing a dangerous game and could be losing valuable brand equity and buzz with their hard-ball tactics.

 This will be an interesting issue to watch in the months ahead. Web companies and networks would be well advised to play close attention…there may be important clues to where web strategy and etiquette goes from here.   

 UPDATE: As many expected, Facebook CEO Mark Zuckerberg has given in to the will of the digital masses and will allow members to permanently shut off Beacon, his controversial new advertising feature. Check out the mea culpa by Zuckerberg on the Facebook blog. See one of several articles on the subject here. Does anybody need further proof of the increasing power of the online customer?

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