- Many prominent influencers have expressed concern about how the ad model perverts the incentives of Facebook (and/or Google, Twitter and others) to do serious harm to society, saying that more creativity is needed -- see the list below*). As Tim Berners-Lee said, "create a new set of incentives and changes...will follow."
- My proposals go beyond those calls -- I suggest action based on a new class of user-sustained, relationship-value-first, business models that could negate those ills – and make our platforms more broadly humane and sustainable.
- This “innovative and visionary” FairPay architecture has been described briefly in Harvard Business Review, and more fully in the Journal of Revenue and Pricing Management, “A novel architecture to monetize digital offerings” (with eminent marketing scholar Marco Bertini as my co-author).
- These methods have been discussed with many companies, including vendors (such as NY Times, News Corp, Disney, Spotify, Rhapsody, IBM, Verizon, American Express, and many smaller companies), platform providers (such as Salesforce and Zuora), and market research firms (such as Forrester and MECLABS).
- They build on proven business trends and behavioral economics principles, but are not yet well-known. (FairPay is an open architecture in the public domain, not a product -- I am working on this as a pro-bono project.)
Immediate action can be begun:
- Show that calls for better business models are not just cries in the dark, but can point to specific actionable strategies by the platforms and by others.
- Suggest market-based solutions that can be acted on by individual businesses, with reduced need for regulation or antitrust action.
- Advocate a simple, proven, targeted, market-based strategy for regulatory or antitrust action that mandates business model incentive-based remedies, thus reducing need for a more intrusive hand. This can be applied independently of the specific business model strategies I propose.
[UPDATE 2/26/19: As published in Techonomy:
To Regulate Facebook and Google, Turn Users Into Customers.
"Requiring a growing percentage of revenue from users…is the simplest way to drive a fundamental shift toward better corporate behavior."]
- Consider why this approach is workable and powerful -- good for businesses, their customers, and society.
- Spread the word to others who can help bring this to broad awareness.
- Stimulate experimentation with this and similar strategies, to prove and adjust them (or to find alternatives) based on learning in varied business contexts and consumer market segments.
Understanding the concepts as relevant to Facebook, etc.:
- To Regulate Facebook and Google, Turn Users Into Customers – a surprisingly simple, proven, market-driven regulatory strategy, published in Techonomy [added 2/26/19].
- Who Should Pay the Piper for Facebook? (& the rest) – a business model solution to the Facebook business model problem
- Privacy AND Innovation ...NOT Oligopoly -- A Market Solution to a Market Problem – a regulatory approach that incentivizes the business model solution for customer-based revenue
- Reverse the Biz Model! -- Undo the Faustian Bargain for Ads and Data – how crediting users for their attention and data is the natural way to re-align incentives while still enjoying ad revenue [added 12/3/18]
- Yes, You are the Product …It Matters …and Can Be Remedied – why this is important, even if a bit of an oversimplification [added 2/12/19]
- Information Wants to be Free; Consumers May Want to Pay – a short, simple introduction to the concepts [added 11/15/18]
- A novel architecture to monetize digital offerings – a scholarly publication in the Journal of Revenue and Pricing Management
- FairPay Changes the "Game" of Commerce – the core operational process of the repeated game that most fully realizes the FairPay strategy
- The Ghost of Pricing Future -- A Thought Experiment – the underlying logic of value-based pricing
- The Relationship Economy -- It's All About Valuing Customer Experiences – why we have to think differently about commerce
- Patron-izing Journalism -- Beyond Paywalls, Meters, and Membership – a rich illustrative summary for an important use case
- Making Customers Want to Pay You -- Research on How FairPay Changes the Game –foundations in behavioral economics
- Finding Good and Fair Customers -- Where Are the Sweet Spots? – where to start
- Profiting from Habit -- Seamless Monetization – making it simple
***Please contact me to explore how you can help -- fairpay [at] teleshuttle [dot] com.
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On the deeper issues of social media and digital democracy
- The Augmented Wisdom of Crowds: Rate the Raters and Weight the Ratings – details a broad architecture for where we should be going in social media (and digital democracy more broadly), more comprehensive and powerful than any I have seen.
- A Cognitive Immune System for Social Media -- Developing Systemic Resistance to Fake News – why we need a systemic solution to limit the spread of cognitive pathogens.
- The Tao of Fake News – on the limits of experts, moderators, and rating agencies – and the need for augmented wisdom of the crowd as essential to maintaining our democratic/enlightenment values.
- Filtering for Serendipity -- Extremism, 'Filter Bubbles' and 'Surprising Validators' – shows how this architecture addresses these specific concerns.
- Architecting Our Platforms to Better Serve Us -- Augmenting and Modularizing the Algorithm – broad solutions to technical issues of openness, transparency, regulation, antitrust, and market forces in platform architecture.
Other updates- Zucked -- Roger McNamee's Wake Up Call ...And Beyond – my review/commentary on Roger McNamee's groundbreaking call to action, summarizing some added suggestions of mine.
- A Regulatory Framework for the Internet (with Thanks to Ben Thompson) – Required reading from the highly respected Stratechery newsletter, plus some suggestions of my own.
- Tim Berners-Lee
- Roger McNamee [+2019 book, added 2/6/19]
- Jaron Lanier [+2018 HBR, asdded 2/21/19]
- Tim Wu [+2017 and 2018 books, added 2/21/19]
- Chris Hughes
- Ethan Zuckerman
- Eric A. Posner and E. Glen Weyl
- Tom Wheeler [added 8/24/18]
- Zeynep Tufekci [added 10/4/18]
- Tristan Harris [added 10/4/18]
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More about FairPay
For a full introduction to FairPay see the Overview and the sidebar on How FairPay Works (just to the right, if reading this at FairPayZone.com). There is also a guide to More Details (including links to a video).
My article in the Journal of Revenue and Pricing Management, "A Novel Architecture to Monetize Digital Offerings" also provides an overview of FairPay (summarized more briefly in the ESADE Knowledge article "Three building blocks to monetize a digital business," and previously in Harvard Business Review, "When Selling Digital Content, Let the Customer Set the Price.").Even better, read my highly praised book: FairPay: Adaptively Win-Win Customer Relationships.
