> "The big negative for Facebook is that we will no longer push for likes or subscribers because we can't reach them all. Why would we invest in extending our Facebook audience size if we have to pay to reach them? That's crazy.
I think this mindset is the poisons venom in Facebook's revenue strategy. Facebook is seen as just a social network and not a legitimate communication or advertising platform like TV, radio, or mobile phones. Cuban has no problem paying for Ad's on Radio and TV, but is appalled when Facebook charges for a similar (And arguably more accurate) service. Facebook's response also makes little logical sense--On one hand they say the fees are to fight spam, but the screen clearly shows that the fees are to communicate with more people.
TV/Radio/Google Adwords/etc is drastically different from FB's advertising model.
The key point, as Cuban says in this article, is that companies spend real resources in trying to acquire "Likes" on FB. People build entire FB tabs. Curate what content gets posted. Build deep integrations on their websites. I've built a lot of this type of FB integration for clients...and I charge a lot, so I know this isn't cheap.
People do this with the expectation that they can reach the people who like their brand. When FB changes the game, it breaks this assumption and makes it doubly expensive to curate and communicate with your FB following. This is pretty much the gist what Cuban is arguing in the article.
On TV/Radio/Google Adwords/etc, there isn't a first step where a brand spends a lot of time and money sending users to said 3rd party advertising platform. You don't first spend development resources on integrating with the radio station's website, ultimately advertising their website for free and sending them tons of free traffic. You just give the radio or TV station your money, they play your ad, and that's it. That is the extent of your advertising investment. It's very concrete and simple to implement.
This is not the extent of the investments people have made in building up FB pages and followers. Brands have spent and continue to spend a ton of time and money on this and like Cuban, they are justified in being ticked off when FB changes the rules in an effort to squeeze revenue from them.
I have no doubt that money is the reason behind charging to communicate with your followers on FB. The altruistic motives like "fighting spam" would best be done with an algorithm. It surely wouldn't be something you could "opt out of" just by having a fat wallet. By FB allowing brands to pay them to spam people just means FB is fine with spam as long as they get paid. That doesn't seem like a stance that has the well being on their users foremost in mind.
I think this mindset is the poisons venom in Facebook's revenue strategy. Facebook is seen as just a social network and not a legitimate communication or advertising platform like TV, radio, or mobile phones. Cuban has no problem paying for Ad's on Radio and TV, but is appalled when Facebook charges for a similar (And arguably more accurate) service. Facebook's response also makes little logical sense--On one hand they say the fees are to fight spam, but the screen clearly shows that the fees are to communicate with more people.