Future of Social Networking after the Facebook Data Scandal

Social media will need to make room for smaller “trusted networks” closer to everyone’s particular interests, for users to maintain their recent willingness to share data with big commerce, predicts Jason Finch, a Scotland-based web interaction pioneer.

Facebook is likely to emerge largely intact from its involvement in the Cambridge Analytica scandal over sales of personal information and election influencing, says Finch. Advertising should also meanwhile keep its place as a dominant form of revenue for top internet groups.

But even before the March ruckus, discontent at Facebook’s disregard for privacy was leading more users to spend time on sites closer to home, from Mumsnet to hyperlocal news and discussion venues covering as small an area as the first half of one London postcode.

For his part, Finch has been planning a mobile-first approach to online social networking that in the first instance will connect a new generation of gay people and their friends. Crucially, the site provisionally to be called GMEET will earn its keep from membership fees rather than exploiting user data.

“People have for years known that Facebook’s business model is based on using their personal data to send them targeted advertising and appear to prefer that model to paying for content online,” Finch argues.

Yet “more are realising that Facebook’s use of their data and behaviours goes far beyond that, into creating thousands of data points that are enough to manipulate them – including into particular voting intentions”.

Although the #DeleteFacebook hashtag has been all over Twitter – ironically another large social media brand that has a similar business model – there have been calls to boycott or delete Facebook accounts almost every year since the site launched, he observes. “It’s hard to see what it will take to kill off Facebook now that it has seemingly become too big to fail and its founder still controls the vast majority of voting rights in the firm while dodging the tough questions that the US and UK governments want to ask him.”

The issues are commercial as well as political. Among those less regularly raised than it should be, Finch adds, is how “Facebook killed the independent social networks and personal homepage websites of the early 2000s, sucking up immense amounts of data about individuals as it did so”.

Having graduated with a degree in artificial intelligence from the University of Leeds, Jason Finch, now 44, went on to research ways in which computer systems could learn about individuals and use that data to personalise content on websites. That led him to create OUT, one of the web’s first social networks, which blended a thriving interactive website for the gay community with a calendar featuring thousands of social events each year.

“OUT used data from users but only to improve their experience in ways that were very clear and to, bizarrely perhaps, get people off their computers and away from the internet; to build social connections in the physical world. It developed and harnessed an approach that lead to far more engaging face-to-face social interaction, a more inclusive and enriching experience than today’s modern social media platforms,” he says.

This was largely because the ethos of the platform was to bring people together to create real world bonds and genuine friendships, rather than to harness the addictive nature of social media to lure people into contributing more and more content for the exclusive purpose of gathering more and more profiling data to sell to other companies.

For smaller sites and apps such as these, “it may be time to return to a fee-based model where social media platforms are still able to have advertising dollars as income but where additional revenue is not from selling user data to third parties without their knowledge of the implications or depth of that data; nor from making it available to academics and statistical analysis experts who are given carte blanche to use it for whatever purposes they may choose”.

OUT, where users topped 100,000, was among those eclipsed in the Facebook glare. But a month ago, Finch started a campaign on Crowdfunder to develop a fresh approach to online social networking that will connect a new generation of gay people and their friends. Crucially, it will derive income from membership fees, events and additional services in preference to exploiting the data of its users.

GMEET’s funding round is already more than two thirds of the way to its initial £20,000 scoping development target. First closing is on April 3rd.

A tech-savvy entrepreneur, in 1995 Finch also launched Port80, one of the UK’s first web development and business consultancy firms. His hobby in OUT, started a year earlier, grew to a total of £1.6m in subscription sales from members plus £160,000 in event tickets and additional merchandising income. In developing Britain’s first highly-targeted online marketing campaign, he transformed click-through rates to more than 5 per cent, from an industry average at the time of 0.1 per cent, using data gathered through dating profile personalisation.

His algorithms had an early ability to match people to other people as well as to events and chat groups in which they might be interested – all based on profile information supplied by users as well as content they posted in messages and on chat forums. OUT gained a reputation for pairing people off for life, not just for larks.

Finch is the first to recognise that now, in creating GMEET, he owes subscribers the utmost clarity on how the start-up will handle and protect information beyond what they choose to share freely. And he hopes the world wide web will return just a little to the “rich tapestry of smaller trusted niche social networks” of 20 years ago.

In his annual pronouncement about the state of the web, its inventor Tim Berners-Lee this year dismissed as a myth that highly targeted advertising is the only business model that works for online social media platforms.

Saying it was time to think more creatively about how we use the internet, Sir Tim added: “Concentration of power creates a new set of gatekeepers, allowing a handful of platforms to control which ideas and opinions are seen and shared. These dominant platforms are able to lock in their position by creating barriers for competitors.”

Through finally being caught red-handed enabling the sharing of private information to third parties, says Finch, its founder has had to admit in public that trust has been breached. But Mark Zuckerberg has past form on apologising, waiting for the latest furore to blow over, and then carrying on with business as usual.

Help may be at hand. The EU’s new General Data Protection Regulation (GDPR) enforcement begins in only two months, the first time data privacy and protection laws will extend to companies worldwide. Companies such as Facebook will have to become far more transparent about how they use and sell it.

Any further abuses will only lead users to the greater trust offered by specialist affinity networks where interactions don’t occur only in the ether.