It’s Time to Replace Facebook

Imagine going to your local grocery store. You park your car, grab a shopping cart, and look at your list. As you head down the first aisle, scanning the shelves, you notice that something major has happened since your last visit. There is now only one brand available in every category.

There is only one brand of cereal: Raisin Bran. There is only one brand of deodorant: Speed Stick. There is only one brand of candy bar: Three Musketeers. There is only one brand of soda: Fanta. And there is only one brand of coffee: Nescafe. For every item you need to buy, there is only one choice. How would you feel?

Let’s take things a little further. Imagine what your life would be like if your local airport only flew to one city: Tulsa, Oklahoma. Imagine what it would be like if your local shopping mall only had one store: Sunglasses Hut. Imagine if your local college only offered one major: Puppet-Making. Imagine if you signed up for a dating website and there was only one other user: Alex. Imagine if your next Presidential election only had one candidate: Pee-wee Herman.

Would you want to live in this world? Probably not. As humans, we crave choice. It gives us the ability to maximize our happiness. For example, let’s say you’re shopping for a car. If you have a long commute, you might choose to buy a Honda Civic because it has great gas mileage. On the other hand, if you haul around a lot of heavy equipment for your work, you might choose to buy a Ford F-250 because it has a great towing capacity. Having options helps you get closer to finding exactly what you need as an individual.

If every shopper was forced to purchase the same car — such as a Chevy Malibu — no one would be happy. It would be too big for some, too small for others. In most industries, it is impossible to create a one-size-fits-all product. People have vastly different needs and preferences. Therefore, as a society, we benefit from having a wide variety of options (or brands) to choose from whenever we need to select products and services.

Unfortunately, variety only happens in an industry where there is healthy competition. If one company dominates an industry, and can basically operate as a monopoly, then consumers are going to be forced to buy whatever that company is offering. Monopolies are good for tycoons but bad for society.

So, let’s talk about Facebook. The company is quick to point out that it can’t possibly be a monopoly because it doesn’t charge users a fee. How can a “free service” ever be accused of ripping off the public? But the truth is, Facebook is not free. It might not charge users dollars and cents, but it does charge something else: personal data. That data is extremely valuable to Facebook and, to some extent, your privacy is extremely valuable to you. That can put you at odds with each other. You want to share less data to maintain your privacy, while Facebook wants you to share more data to drive their profits.

If you both had equal power, then you would sit down and negotiate a compromise. You would try to meet in the middle. But you don’t have equal power. Facebook has 99.999% of the power. As a result, there is no negotiation. There is no compromise. It’s Facebook’s way or the highway. If you think of your personal data as a new form of currency, then Facebook can pretty much charge you whatever price they want. If Facebook had true competitors, those companies might try to “underbid” Facebook by offering to harvest less personal data from people who use their network.

It’s no coincidence that Facebook has very few competitors in the social media space. The company has worked hard over the past ten years to buy or bury competitors. And, unfortunately, the bigger Facebook becomes, the easier it is for the company to maintain what is effectively monopoly power. Facebook is currently sitting on a $52 billion war chest (cash) that could be used to strong-arm any startup that threatens its dominance in the social media space. Facebook also spends heavily on lobbyists in Washington to ensure that the company will not be regulated or broken apart by our government.

Without competitors, Facebook can charge a very high price (in terms of data) for their service. They can read every message you write. They can scan every photo you upload. They can track your location via GPS wherever you go. They can follow you on the web and track the websites you visit (even after you leave Facebook.com). They can share your data with advertisers and third-party apps. They can track every comment you “like.” They can follow every article you read.

They can also make corporate decisions that prioritize profits over people. They can build algorithms that make their product more addictive (even when it hurts our social productivity and mental health). They can attempt to cover-up data breaches without notifying users. They can violate privacy laws despite government mandates. They can choose to sell and show political ads that include false statements. They can encourage the spread of fake news because it drives engagement. They can have secret meetings with the President. They can sell ads to Russian troll farms. They can hire a PR firm to secretly smear people who complain about Facebook’s actions.

No company should have unchecked power. It creates major problems. It is un-American. Our country was founded on the idea that healthy competition will keep companies on their toes and provide a wide range of helpful options for the people. Unfortunately, it has been very hard for companies to compete with Facebook for three main reasons:

The first is data portability. Although Facebook claims you can download “your data” any time you want, that really isn’t true. What you can download is your photos. You can’t download your messages and, more importantly, you can’t download your social network (i.e. your contacts). That means that if you want to “break up” with Facebook and join another social network, you will have to rebuild your connections, one by one.

This is the modern-day equivalent of a problem that used to exist in the cell phone industry. Back in the day, if you hated your cell phone provider (such AT&T) and you wanted to “break up” with them, you would lose your current phone number (i.e. 415–555–1234). That meant that if you switched providers, you would have to ask all your friends and colleagues to update your phone number in their list of contacts.

This policy prevented a lot of people from changing providers, even if they were extremely unhappy with their service. Things didn’t change until the government finally stepped in and forced cell phone providers to give consumers the option to take their phone number with them when they switched companies. So far, the government has not forced Facebook to make user data more portable which would encourage more healthy competition.

The second reason there are so few competitors to Facebook is cloning. Several years ago, a new social media app — SnapChat — was growing quickly. The company had created several unique features that were a big hit with younger users. Suddenly, Millennials were spending most of their social media time on SnapChat instead of Facebook. This created some concerns for Facebook leadership. They were suddenly looking at some very real competition in a category they had been comfortably dominating. Their last major competitor — Instagram — had been quickly purchased for $1 billion and added to the Facebook portfolio of products.

So, what did they do with SnapChat? First, they offered to buy the company. SnapChat was only two years old, but they offered a whopping $3 billion. It would be hard for anyone to turn down that kind of money. But SnapChat co-founder and CEO, Evan Spiegel, said “no.” Still stinging from the rejection, Facebook decided that it would try a different approach. They decided to simply copy their competitor. They took most of the popular features and designs from SnapChat and added them to their social media apps (Facebook and Instagram). The tech industry was somewhat shocked. Was it legal for Facebook to so blatantly copy a competitor?

As far as we know, however, the government never stepped in to tell Facebook that they could not purchase their largest competitor (SnapChat) or to tell them that they could not copy their competitor’s features. We do know that many Facebook employees were uneasy with the cloning. It even seems that the Chief Product Officer at the time, Chris Cox, was against the decision but was ultimately overruled by other executives who wanted growth (and profits) at any cost. The strategy worked and younger users began to return to Facebook. SnapChat is still around but they struggle to compete with Facebook since the company is willing to copy all of their features and it has more money and more users.

The final reason you don’t see more competitors to Facebook is the “network effect.” Here’s an example of this principle in action. Let’s say that you’re planning to go out to a bar this weekend. You’re not organizing an event, you’re just going to show up to a bar by yourself. Now let’s also say that your neighborhood only has two bars: the Shady Dog and the Watering Hole. The Shady Dog is kind of an expensive bar and the staff are rude. It’s not ideal. But it’s been in the neighborhood forever, and you know that if you go there on a Friday night, you are definitely going to run into some of your friends. Seeing people you know will make the evening more enjoyable because you have an opportunity to socialize and it’s a heck of a lot better than sitting alone.

The Watering Hole, on the other hand, is a very different kind of bar. It has great prices and friendly staff. But, it’s relatively new to the neighborhood. If you go there on a Friday night, there’s a risk that you won’t run into any of your friends. You don’t want to take that risk, so you head over to the Shady Dog. Your friends make the same calculation, and so they also decide to head over to the Shady Dog. In this scenario, no one wants to “go out on a limb” and be the first to try out the new bar. So, the Watering Hole never really takes off and, eventually, the bar shuts down. The Shady Dog was never a great bar, but it survives because it is the “default” option.

To some extent, people use bars for the same reasons they use social media. In both situations, they want to meet people, discuss ideas, and connect with friends. If there is a social media app that already has practically everyone (Facebook), then people are going to be hesitant to switch to or even try a new social media app with very few users. It’s a catch-22. Social media apps need a large base of users in order to attract a large base of users. This makes it hard for new apps to ever “take off” and gain a critical mass. To be fair, this isn’t Facebook’s fault, it’s just the nature of the industry. However, it would be easier for new social networks to emerge if consumers could “port” their contacts from Facebook to a new provider.

For these reasons, it is very unlikely that a true competitor for Facebook will emerge at any point in the next ten years. That means consumers won’t have real choices in the social media industry. It also means that Facebook will continue to do whatever it wants, running around like a bull in a china shop. This arrangement is great for Facebook executives and shareholders. They will profit handsomely. Mark Zuckerberg is currently worth $73 billion and he’s just getting started.

Facebook wants things to stay the way they are, which is why the company is lobbying Washington heavily and asking the government to either leave them alone or let them regulate themselves. Unfortunately, Facebook seems to have tremendous power over politicians and it is unlikely that the government will step in any time soon to do anything more than slap the company on the wrist with a fine. This gesture gives the government more revenue, but it doesn’t do much to help you and me… or change Facebook’s behavior.

Most of the people I talk to are frustrated with Facebook, but they don’t know how to fix the situation. They feel like they only have two options. Option 1: Stay on the platform and let the company do whatever it wants (even if they disagree strongly). Option 2: Delete their Facebook account which can feel liberating in the short-term, but perhaps lonely in the long-term. Giving up Facebook is basically giving up social media. That’s a problem because connecting with friends and family online can be fulfilling to many. It’s a “damned if you do, damned if you don’t” kind of situation. People I speak to often compare their relationship with Facebook (the company) to their relationship with their cable company. They might not like Facebook, but they don’t have anywhere else to go. They’re trapped. That’s exactly how Facebook wants you to feel.

But, if we fall into this trap and ignore Facebook, if we allow the company to do whatever it wants, if we accept the lack of competition in the social media space, the costs are going to be very, very high. We’ve already seen a lot of bad behavior from Facebook over the past three years and things could get much worse. What’s at stake for the average American if we do nothing about Facebook? Privacy. Truth. Democracy. Free markets. Social unity. Political progress. Mental health. Child safety.

So, let me suggest a third option. We are only going to see a strong competitor to Facebook if we, as a society, come together and make it happen. When factory workers are feeling mistreated, they don’t sit around and complain. They get organized. They form a union, agree on a list of demands, and head to the negotiating table. If they don’t stand together, they have almost no negotiating power and anything they try will ultimately fail.

We as a country need to get organized whenever there are corporations that are willing to destroy our way of life just so a few executives can become billionaires. We need to work together to create a new social media company (or even multiple social media companies) that can grow large enough to compete with Facebook. We need leverage so that we can negotiate better terms regarding the “price” for services such as social media. Competition in this category will be good for all of us.

So, who do we turn to for this new social network? Who could create a strong enough competitor to Facebook? Well, we could ask the government to step in and create a new social network. It could be a public utility similar to the post office. Most people would probably consider this to be a terrible option. Can we really trust the government with our public and private conversations? Every news outlet seems littered with stories about how the government is constantly bickering, biased, inefficient, and corrupt.

So perhaps, instead of turning to the government, we could ask another large company, like Amazon, to step in and create a social network. While they have the power to give Facebook some serious competition, I fear that any publicly-traded company would also be tempted to make the same mistakes as Facebook. They would be faced with similar crossroads that are unique to the social media industry. They can do the right thing and earn $100 million. Or they can do the wrong thing and earn $100 billion. Historically, there have been similar temptations in the banking, tobacco, and pharmaceutical industries. If a company has executives and shareholders, it’s going to be hard for them to ignore these temptations.

As another option, we could hold a competition among startups. They could present their proposals for how they would build the next social network with better privacy and more ethics. In theory, whoever wins the competition would receive our full support as a society. While this approach might sound promising, it too would likely fail. After all, Facebook was once a young startup. A group of students created the company in a Harvard dorm room after hacking the student directory to rate the attractiveness of their female classmates. Mark Zuckerberg was among them and he called people “dumb fucks” for trusting him with their data.

Several years later, Zuckerberg’s business cards had the title “I’m CEO, Bitch.” The company could have chosen a more noble path over the past 15 years, but instead they seemed intent on crushing the competition and getting rich. They also had investors who wanted to see big returns. Cash is king. So, their priorities affected their decisions. And their decisions affected our society. If we select another startup from Silicon Valley to replace Facebook, they may end up making the same mistakes. Don’t get me wrong, I like startups. But the social media space complex and it comes with unique challenges.

I believe the next major social media company shouldn’t be a government organization, a major brand, or even a startup. I believe it should be a non-profit. Social media is too important to mix with pure capitalism. The combination can create extreme wealth for a few people while causing extreme damage to billions of other people. The good news is, there are several tech industries where non-profits have been able to successfully add value to society without becoming overrun with greed. Think of Craigslist, Wikipedia, and open-source software.

Now, you might hear the word “nonprofit” and think that this new social media company would be forced to survive entirely on donations. You might also worry that its products would be sub-par since it would be working with very small budgets. But that is not the case. A non-profit social media company could still sell ads. These ads could be fairly harmless like a promotion for Tide laundry detergent or a picture of the new Impossible Whopper. Ads don’t need to be controversial or intrusive.

This non-profit social media company could also share revenue with publishers when users read news articles. And there are plenty of other ways to earn revenue (to pay the bills) without harming society. The important thing is that, as a nonprofit, it would only be trying to “break even.” It would not be trying to earn billions of dollars in profits for shareholders and executives. Without the temptation of greed, a nonprofit social media company could focus more on building products that help society instead of just milking users for as much cash as possible.

To be fair, running a social media company isn’t cheap. You need to hire smart engineers and you need to pay for servers to store photos, videos, messages, and so on. But a nonprofit social media company could earn significant revenue from selling ads that are only lightly targeted to users. The ads people see while using the platform could be based on their age, gender, and city. That’s it. Nothing more.

This very light targeting would be more than enough for most advertisers, including small businesses. It also means that the nonprofit social media company could earn enough revenue to cover their costs without needing to take the additional step of stripping away all privacy and reading your messages, scanning your photos, tracking every website you visit, tracking your GPS location, determining your political views, studying your friends, and listening to your conversations.

This new non-profit social media company could also have the freedom to ban political ads. Facebook currently allows political ads, even ads with false and incendiary statements. The company claims that they are promoting free speech with this policy. But they are ultimately accepting money to spread false information. And they’re making it easy for politicians to target individuals who will “agree” with this false information without even bothering to investigate the accuracy of the statement.

This is very, very concerning. So, why would Facebook agree to allow political ads with false statements? Well, political ads currently generate several hundred million dollars a year in revenue for Facebook. That’s a ton of money, even if it is a small percentage of Facebook’s revenue. That’s enough money for every Facebook executive to buy a new vacation home, every year. But you also need to think about the future. Most political advertising dollars are currently being spent on television. As the world changes, more and more of these dollars are going to be spent online. Ten years from now, political ads could be a billion-dollar business for Facebook. So, the company wants to make it clear to politicians today that their platform is super-friendly towards political advertisers (such as Super-PACs) and will allow virtually any type of advertising behavior, even messaging that allows lies. Facebook may claim that they want to do the right thing (allow free speech), but in reality they have a huge incentive to do the wrong thing (accept money to spread false information that could improperly influence elections).

If we want to create change and we want an alternative to Facebook, we will have to come together and work on this problem side-by-side. This is not a liberal issue or a conservative issue. It is a problem that affects everyone. To survive and grow, a new social network would need support from millions of people in the early days.To use my analogy from before, the new bar needs to be busy or else it will never take off.

I know there’s a lot of crazy stuff going on in the world right now and it’s easy to feel overwhelmed. It feels like there are so many things in the world that are broken and so desperately need to be fixed. The good news is, the problem with social media is something we can actually change. And if we get it right, if we as a society create a new social media company that can bring out the best in us, instead of the worst, it could have a profound impact on not only our lives but also the lives of generations to come.

I for one would gladly join a coalition of people who want to work on this problem. I’m not smart enough to lead the effort, but I would definitely be one of the worker bees. I’m ready and willing to make a difference in our community. So, what do you think? Do you agree or disagree with this essay? Whether you love it or hate it, I would love to hear your feedback. I think it’s important to see all angles of a problem and hear every side of the debate. I have my opinions, of course, but I want to hear your opinions too. Please feel free to share your comments below. Respectfully, Tavis.

(PS — I used to work at Facebook, so I have seen the company culture and leadership from both the inside and the outside.)