That’s a question now running around the net. The entire story started with Steve Ballmer saying the following: I think these things [social networks] are going to have some legs, and yet thereâ€™s a faddishness, a faddish nature about anything that basically appeals to younger people,â€� Mr Ballmer told Times Online yesterday.
And then there is also this part: â€œThere canâ€™t be any more deep technology in Facebook than what dozens of people could write in a couple of years. Thatâ€™s for sure,â€� he said.
One thing is for sure. It polarizes people. One good post on the matter comes from Scoble called Steve Ballmer still doesn’t understand social networking. The other one you should read is Techcrunch’s Fadnation: Why Steve Ballmer could be right.
As you have now read those two posts, I will shoot over a few of my own comments. First of all, I am pretty sure that Steve Ballmer does understand social networking. He probably even understands that my own biggest social network is currently my address book in gmail, which is what I use to sync in my friends in new social networks within minutes. He also understands that Microsoft possibly needs a strategy to allow for swift investment in small startups (which they already have, sadly only pushing their own software at the same time, but that’s ok too) and investments in stuff like flickr, wordpress, skype or youtube, isn’t currently a high priority for Microsoft. Which of those services will in 5-10 years, add a few billions of free cash flow to Microsofts belt? Probably none of them. The same with social networking. That’s a feature, and the networks will be freed up eventually. Microsoft is looking for the next billion dollar thing, or for something that allows them to get closer to the billion dollar thing, and at the moment that is advertising, which includes networks, better management of advertisements, apis and so forth, because they will never have all the sites they need to run ads on anyway.
Next up, is Facebook a fad? Nope, I don’t think so. I really do like it and it’s a nice service. If the money idea behind social networks is all about using social networks as a basis to better target ads, then all the big players will be desperate to create an open social network protocol they can tab into, because better targeting all the time is the only way this will really work.
What the fad part is really about is that have my contacts in Xing exported, I have them imported into my GMail address book and whenever something opens up that I like, I can just sync that in and have many of my friends back. Especially the younger generation is a group of people that will very swiftly move to a new service, importing in their old friends. Facebook obviously will not die, but it is not certain that it will not be replaced by another “fad”, another hyped system that is the one to end them all.
So with the right set of features, with the right people to start with, you will probably be able to build the community that Facebook has, or rather a similar one that you might be able to monetize. That is something that MS might invest in, somebody that has the key drivers right and Ning might be more interesting down the line, at least from a business perspective, and from a Microsoft Platform view.