Graphing Social Patterns conference, which was held this week in San Diego, brought together key people who are shaping the newly born social platforms industry; platform providers, app makers, investors, advertising networks, etc. Our own Sean Ammirati was one of the speakers and has already covered some of the most important bits from the conference, including Charlene Li's keynote. In this post, we'll quickly recap and highlight some of the important announcements and important data that we were able to extract. We also have a short interview with RockYou! founder and CTO Jia Shen.O'Reilly's
GSP kicked off with the Charlene Li keynote. Charlene talked about the social graphs provided by the Facebook Platform and OpenSocial as "the air of tomorrow's web." What she meant was that the social graph is going to be an essential piece of tomorrow's web, and the sites which don't embrace it will most probably become extinct.
The second keynote came from Amit Kapur of MySpace. Amit gave important insight about the monetization of their network, but admitted that "social networking is hard to monetize," which is something we have also heard from Google. Amit said that regular contextual advertising doesn't work well for social profiles and that's the reason why MySpace is focusing on their own monetization technologies, which they call, HyperTargeting. HyperTargeting is already in use by big clients such as EA, Microsoft, Taco Bell, Proctor & Gamble, and FOX. But he added that they are also planning to release a self-serve solution for long-tail advertisers. Presumably, it will be a social doppelghanger of Google AdSense.
The third keynote was given by Benjamin Ling of Facebook. He made some important announcements, including the new E-Commerce APIs that they are planning to release soon, as well as the new user-driven localization solutions that they will provide for app makers. Facebook Platform investors at the event were unanimous in their belief that the E-Commerce APIs are big news, because it means new business models and revenue sources for app producers. On the other hand, their localization solutions seem to be just another step in their recently debuted internationalization efforts. Indeed it would be inconsistent to offer a localized platform which barely has any localized apps on it. And the good thing is, since this is user-driven, the costs for app makers to get international is low and also linearly dependent on their merits.
Day One Announcements
Following the keynotes, there were a number of interesting announcements made, including:
- NetVibes introduced Ginger. Ginger is a social version of NetVibes that allows you to pull in friends from your existing social networks, share news with them and follow their reading activities. In other words, as NetVibes' Chris Damsen noted, Ginger makes Facebook, your private place on the web, a more public place.
- MyBlogLog introduced Bluetooth capabilities and a new FriendFeed-like feature. The Bluetooth feature allows you to see other MyBlogLog users who are close by. When we tested it with Ian Kennedy of MyBlogLog, at least 10 MyBlogLog users who were attending the conference showed up on our list. In some sense, this new feature brings MyBlogLog's distributed social networking into the real world.
- Bebo, Myspace, hi5, and Friendster are launching or have already launched their own OpenSocial-based platforms.
- Chris Messina of Citizen Agency introduced his distributed social network project, DiSo. DiSo's architecture depends on existing open standards such as OpenID, XRDS-Simple, and microformats. It sounds very geekish for now and is too-focused on technical aspects, instead of the social realities that actually make a network work. But it has the potential of becoming the "Linux" of social networks.
Compared to day one, day two began with more technical topics. MySpace's Jim Benedetto gave some information on their new platform, which extends existing OpenSocial v0.6 standards with MySpace specific features like bulletin boards. The interesting point about the MySpace Platform is that it is going to launch very restricted. All app submissions will have to go through a safety review process by humans. Hence there is going to be an unavoidable lag between releasing an app and its availability on the network. But all these limitations will be slowly removed with a measured approach, according to Jim. He said that this is to prevent spam and protect the long-term value of the platform.
As most of the app developers in the conference noted, including representatives from RockYou! and Slide, restrictions by platform providers will definitely cut down their fast viral growth opportunities, but the applications that create a real value for the users will still be able grow virally, perhaps at a slower pace but stickier.
One of the shortest but definitely most informational sessions of the event came from Roger Magoulas of O'Reilly Media. He showcased some very interesting numbers and statistics that O'Reilly has collected from the Facebook appsphere. In summary, he showed that:
- installation numbers are no longer as big as they used to be
- active usage rates have dropped significantly too
- most of the apps are released under the "just for fun" category
- there is more adoption and engagement in "games"
- there is a tendency towards winner-takes-all; 1% of apps have 75% of app users, 20% have 99%
Later, in a session that brought together top Facebook game developers, including Mark Pincus of Zynga, there was agreement that social games will replace casual gaming, just like Facebook messages are replacing emails. Also Mark noted that live games don't work so well on Facebook, because once people leave the game, they don't come back; so in order to create real engagement, asynchronous models (as in Scramble) are far better, because people love to email their friends and call them back to the game.
Some other interesting notes we picked up during the course of the event:
- Facebook advertising is starting to get very profitable. Peanut Labs announced that they distributed $200K to their members just in the past 1 week.
- New advertising models (besides CPC and CPM) are emerging inside the Facebook Platform. The CPI (Cost Per Incentive) model of SocialMedia and the CPE (Cost Per Engagement) model of VideoEgg are just a couple of examples. With CPI, the user is invited to install other apps; with CPE, the user is shown a lightbox page which appears as a new layer on top the Facebook canvas page that he was actually looking at.
- Facebook called on people to produce productivity apps and focus on the long-term value, not viral growth.
- Investors noted that app makers shouldn't expect to become instant millionaires with their applications. They also highlighted the importance of long-term value and stickiness.
- Facebook app makers are concerned about Facebook's moves to release their own apps; like Pages. They think that Facebook should just provide the platform and not be involved with new apps anymore.
A Brief Interview with Jia Shen
At the end of the day, I had the opportunity to sit down with Jia Shen, the CTO and co-founder of RockYou! and ask him a few questions. Jia acknowledged to me that his company has had a tremendous advantage over others by entering the field early, he also said that these platforms are becoming less permissive for viral growth because of their new safety restrictions - which is why those who plan to make a Facebook app are strongly encouraged act as quickly as possible.
I asked Jia about their ad network, how it was going, and what is the percentage of revenues from non-RockYou! inventory. He told me that it is going well and that the non-RockYou! inventory now accounts for a majority of the revenues generated on the network. He noted some of their clients include Coca-Cola, Johnson & Johnson, and Sony. He also said they are not planning to enter the long-tail advertising race right now.
As for localization and the growing number of international social networks opening up new platforms; he said that they will look at the specific characters of the network that they are entering and make necessary changes to their apps if required. But he added most of their apps are generic so they don't expect big changes. I asked him whether they're planning to make acquisitions to get the leading app makers in outside markets, and he told this is not their primary strategy yet, but if they do, their first target will be big demographics such as apps for Spanish speaking countries.
All in all, GSP was a very useful event for anyone working in the social networking industry. There were a number of enlightening sessions and key people who drive the social future of the web were in attendance. As Charlene Li noted, users will get suffocated without the portable social graph; so as a web developer, you'd better catch up with these latest developments and get ready for the future of the web in order to keep your visitors happy. The move of Sheryl Sandberg from Google to Facebook is more than enough to tell you where we are headed.