This profile doesn't exist.
When you last tried to register on any web service, you were likely to see a “login with Facebook” button somewhere during that process. This small detail emphasizes the enormous influence of this social network in the modern information space better than any statistics. With a user base the size of almost a quarter of the world’s population, Facebook has long secured the title of “the king of social networks.”
Watching the rise of blockchain technology, Mark Zuckerberg had recently written a post about a “decentralizing force that puts more power in people’s hands.”
Remember that the first four words of Facebook’s mission have always been “give people the power.” Does this mean Facebook will veer in the direction of decentralization or will it ever remain a centralized relic in the world of blockchain-based social networks?
Is it possible to apply decentralization to a social network? Many platforms aim to take the place of Facebook or Instagram or YouTube as they try to propose something that lacks in centralized networks: security and the possibility to earn rewards and get payments for uploaded content.
Among the active projects, we can pick out the following ones:
So, what about the blockchain revolution? Is it worth it for Facebook to fear competition from its decentralized younger brothers?
Let’s take a look at the dynamics of the number of Facebook and Steemit users, as the largest representative of the “decentralized family” of projects.
Number of monthly active users of Facebook (in millions). Data: statista.com
Active Steemit users per month. Data: steemit.com
This simple parameter clearly shows the astonishing difference in audience size between the two platforms. While Facebook has around 1.5 billion unique active users monthly, Steemit can only boast about 150,000 users. The difference here is impressive, and looking at it, one can easily understand what a difficult thing it will be to cast “King Facebook” from its throne.
I will give just one more example to show the huge difference in user engagement on both platforms. According to the same Steemit statistics, the total number of transactions on the platform per day, which reflects the total activity of users on the Steemit network, exceeds one million.
Number of daily transactions on Steemit platform. Data: steemit.com
Is this a huge number? It’s not so big if we take into consideration that every minute of a day (!) Facebook users push like for around 4 million posts.
So Facebook is a Leviathan, and decentralized projects like Steemit are small fishing boats that are intent on killing It.
What are the reasons for such a huge difference and do blockchain projects revolving around social media have a chance?
The first and foremost reason is not connected with the internal advantages of Facebook. It is not even connected with the problems of decentralized solutions. I am strongly convinced that the main reason for facebook priority was that it appeared to be the first to come to the social network market.
Mark Zuckerberg was the first one who applied the developing Internet technology to create a university social network and thus apparently became the pioneer who fulfilled the needs of his surroundings. After a year since its launch, Facebook had over 6,000,000 users.
This rapid rise was possible due to a good idea, but then the positive feedback loop came into force. The platforms that followed the leader (FB) had to conquer the people’s attention, while Facebook got it just because new potential users heard about it first. So, the larger became the network, the faster it grew. This is called the Matthew effect, or winner-takes-all model.” This phenomena got its name from a quote from the Bible:
“I tell you, that to every one who has will more be given; but from him who has not, even what he has will be taken away.”
New users didn’t choose between different platforms from some hypothetical list, they just heard from friends about Facebook and joined the network. In scientific literature, this effect is called the “preferential attachment.”
Today, smaller platforms find themselves catching up, and have to fight for the attention of the audience with the winning platform.
It should be known that the Lindy effect works on Facebook as well, only strengthening its leadership over time.
It’s not only that Facebook was the first in the social network market and that almost a quarter of the globe uses it. It’s about the general concept of decentralized platforms. Look at Bitcoin — this is the standard of a secure and decentralized network, but inside it there are consolidation processes that significantly affect the course of events (for example, Bitmain today controls more than 40% of the network’s hashrate). There is reason to believe that such processes are common to all decentralized systems.
As Wired says, “The reality is that most people do not want to run their own web servers or social network nodes. They want to engage with the web through friendlier platforms, and these platforms will be constrained by the same forces that drive consolidation today.”
The issue of the advantages of decentralized solutions over centralized ones in matters related to security is controversial. On one hand, the latest Facebook data breach could have been probably avoided if Facebook was decentralized. The absence of a single server or group of servers that govern the network greatly increases the system’s resistance to attacks, unless the blockchain code has vulnerabilities (and recently it became known that critical vulnerabilities have not been eradicated, even in the Bitcoin code).
If the scandals surrounding Facebook’s data leaks continue, people will sooner or later turn to the issue of the security of their own personal information. Provided that decentralized platforms prove themselves to be perfect in this matter, it can be an additional incentive for the audience to move. However, it is not easy to achieve real decentralization.
While the overall idea of decentralization might be appealing to some people, it would be hard to directly compete with Facebook on its own battlefield. It’s deeply integrated into the lives of the regular Internet audience, serving as a digital identity on many sites over the Internet. It has all the necessary resources to compete with any rival, and it’s too early for the general audience to buy the idea of decentralization.
At the same time, there are some regions of the planet where Facebook still has no penetration — such as emerging markets. What’s the point in trying to cut off a piece of the pie of Facebook when there are still unexplored niches. More than 2 billion Internet users live in emerging markets, and that’s an enormous audience for any project. That’s where new decentralized social networks, such as previously mentioned BOLT, can succeed.
The main focus should be to give access to social networks and to new content to users in developing countries, and these countries usually have outdated technologies, a low bandwidth and, generally, don’t have a good financial situation. Those are the problems that should be addressed. BOLT tries to solve them by cutting costs in the subscription payment process, delivering a new video format for low bandwidth users, and a way for content-creators from those regions to be rewarded for their contribution. With this solution, users who were cut from entertaining content, news, and sports, now get access to it and that can be a good selling point in winning these markets.
We haven’t seen yet an explosive growth in popularity of decentralized social networks compared to the leaders of their industries. Maybe the key factor is that we join a social network for other reasons: Facebook because our friends are there, Reddit because it’s funny, LinkedIn so we can find new professional contacts… only a few people join a social network for technological reasons, for instance, for the sake of decentralization.
The social media market is so huge that decentralized projects will certainly find a place in it, but there is still a long road ahead. A good place to start the growth is the emerging markets. If any of decentralized projects will be able to utilize the advantages of blockchain and suit the needs of users from these regions, they will have a chance to become leaders in that segment.
Kirill Shilov — Founder of Geekforge.io and Howtotoken.com. Interviewing the top 10,000 worldwide experts who reveal the biggest issues on the way to technological singularity. Join my #10kqachallenge: GeekForge Formula.