Can Facebook avoid becoming the next AOL?

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For the younger readers, AOL was is this company that focused on providing the Internet with training wheels. They utilized what was something called “dial-up” (Internet via your phone line) and would send you a seemingly endless stream of CDs (those little circular things that play music and sometimes have software on them), to get you to sign up. (Thye sent them to you in the mail. If you’re not familiar with that, please stop reading and go ask your parents what snail-mail is.) If you were foolish enough to sign up, AOL essentially placed a portal that they controlled as a filter on to the Internet. (Just like the On-deck mobile experience. No wonder people love it so much!) For those that are comfortable with the Internet, it was a less than stellar experience. For those of you that question where the any key is or think you can break your computer by pushing a series of keys all at the same time; it was perfect for you.

AOL is now ostensibly dead although they do make some good money advertising. AOL wishes they would have had a crystal ball to be able to see this explosion in social networking that has happened. (Of course their brand was not exactly positioned to deliver on these changes, but they could have figured out something.)

Can Facebook avoid this trap. Currently Facebook traffic is almost as high as Google and I can see that many people don’t leave the confines of Facebook when they “use” the Internet. You can of course code to Facebook’s API and get your application included in their ecosystem and yet I would not call it the web, just as I didn’t consider AOL the Internet. I posted a while back about Facebook and Apple becoming walled gardens on the playing field of Google. I’ve also mentioned how the Internet to date has been for the most part an amazing academic experience and that big business is now going to get serious about making money on the elemental aspect of the Internet; the content.

Right now businesses can participate in these venues if they pass Facebook’s approval process (not to mention Apple’s) and as time goes on, the chance for filtering will grow. Pretty soon, Facebook won’t be allowing applications on their platform because they are seen as direct competition. (This has already started.)

One way Facebook may not end up like AOL, is its users. Us. It’s up to us to insure that we stay up to date on compelling services/applications, outside of Facebook. What is Google doing? Is there a BlackBerry application for that? It is vital that we seek things out that are useful to us and they don’t need to be plugged into Facebook. Currently this seems like corporate suicide but over the next five years you will see a backlash and as long as those offering are compelling, we need to find them.

1 comment

  • Very interesting post and a good read.

    I can’t see Aol and Facebook really in the same market. Aol for me was all about getting access to the internet. I already have that access with Facebook and while I can choose to interact within the Facebook site, I don’t feel like I’m trapped. With Aol, that’s exactly what happened, entrapment. “You can’t use the Internet unless you go through us.”

    Facebook will need to remain open to survive so that brands and consumers can tailor it to their personal needs. I agree with you that there’s a danger they could start enforcing non-competition, which of course could be a very negative strategy. They should also be cautious about only allowing people to communicate through Facebook (i.e. AIM for Aol). Give people the flexibility and choice, then you have a greater chance to attract and not repel.

I'm an Associate Teaching Professor of Digital Marketing at the Daniels College of Business, University of Denver. I also consult with startups and established brands. I'm currently focused on artificial intelligence, cognitive neuroscience and culture. I am married to an amazing woman and have two incredible children. I was raised in Colorado and spend my free time with family, biking, snowboarding and going to the Pacific Ocean to SCUBA dive and/or surf. I'm passionate about architecture, design, street art, photography and the art that tattooing has evolved into.

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