Facebook Privacy Slip-up - Randi Zuckerberg Family Photo

Now isn't this rich with irony.  Randi Zuckerberg posts a private family photo to Facebook and the privacy policy doesn't protect it.  They were poking each other with the new Facebook Picture Poke.  The picture goes public and Randi is not pleased.  Randi is the former marketing chief of Facebook and should know better.

Inquiring minds want to know though -- where is the lovely Mrs. Mark Zuckerberg in this photo?  Maybe she and Mark are not into poking any more?  Just saying ..

Read More

More Reasons Why To Quit Facebook and LinkedIn

Man, I am looking smarter and smarter every day for quitting Facebook and LinkedIn. Can you imagine that your credit rating will suffer for something that you have posted on LinkedIn or Facebook?

Here is the URL of an article of Privacy Violation on these social networking sites:

http://www.smeweb.com/index.php?option=com_content&view=article&id=3722:facebook-inc-data&catid=62:news&Itemid=101

And here is a reprint of the article in case it goes off line:

Credit agency plans to use Facebook Inc data to form credit ratings

Monday, 11 June 2012 11:25

Schufa is also looking into using information from other sources including Twitter and Linkedin.

Schufa, Germany's largest credit agency, is planning to use data from Facebook Inc (NASDAQ:FB) to form credit ratings, according to leaked documents says to consumer advisory body Which?

As well as pulling information from Facebook pages the agency is looking into using information from other sources including Twitter, Linkedin and Google Street View to assess individual credit ratings.

The documents, leaked to German broadcaster NDR, suggest the agency is planning to use 'crawling techniques' like those used by search engines to find relevant information with aim of 'identifying and assessing the prospects and threats'.

Mark Batistich, a member of the Which? Legal team, said: "Whilst it's not exactly clear what credit checking companies such as Schufa intend to do with data obtained from Facebook, it is certainly possible, at least in the UK, that using such information without consent could be in breach of the Data Protection Act, and also the Facebook Terms and Conditions, which set quite stringent guidelines on what can be done with information obtained from that site."

The plans have drawn criticism from the German consumer protection minister Ilse Aigner as well as justice minister, Sabine Leutheusser-Schnarrenberger, who both said the plans went too far.

Read More

Why Facebook Will Not Overtake Google

Last night I watched a video that interviewed a stock market analyst called Arvind Bhatia associated with the firm Stern Agee. He was quite bullish on Facebook, saying that it will overtake Google etc etc in advertising revenues once it monetizes the mobile market. It was quite obvious that he is enamored with Facebook and Mark Zuckerberg.

It reminded me of the tech boom that collapsed in 2001-2002. People were raving about waterfont property on the Internet, only to discover that it didn't exist. Facebook is now undergoing an IPO frenzy, and the opening price suggests that they are capitalized at 100 times their trailing revenues. For any other stock, this valuation would be sheer fantasy. Surely that if something is too good to be true, it is.

With the unbridled optimism of Wall Street, they are charging ahead, forgetting that one piece of exploding Muslim-fanatic underwear on an airplane can turn unbridled Wall Street optimism into deep despair.

As I was listening to analyst Arvind Bhatia, I was struck by a couple of things. He was demonstrating a zeal for Facebook that seem to transcend the rational practicality of most stock pickers.

Let's look at some aspects of Facebook and its IPO. First of all, the smartest stock picker in the world, Warren Buffett is not participating. This tells you something.

Secondly, Facebook says that they have a billion users, yet all they can garner is $4 per user per year. Facebook has not yet figured out how to monetize its users, and specifically it has not figured out how to do so without violating their privacy. Google has.

Bhatia the analyst says that Facebook has a lot of personal information that can be used to direct advertising to. While this is true, a lot of that personal information is not that useful in getting monetized. For example Bhatia mentioned that Facebook knows what high school that I went to. After many years of graduating, our high school displays the entire spectrum of graduates who have go on to greatness, and others that have gone on to jail. There is no smooth curve of socio-economic demographics to glean out of that kind of information.

When doing a comparison of Facebook and Google, Google has the upper edge. First of all, they have an order of magnitude of intellectual capital compared to Facebook. Facebook has a bunch of php coding freaks brogrammers. Put plainly, Facebook isn't smart enough to take their info to the next level.

Google has the smartest guys on the planet developing algorithms. There is a huge difference between the two. It is the same reason why in spite of the fact that China makes all of our stuff, they will never overtake us in development and innovation. All of the intellectual capital resides in the free universities and companies in America that are unfettered by dogmatic rules when it comes to science and thinking. The profit motive is a very strong innovation driver, especially when it is coupled to a strong research base. Facebook doesn't have a strong research base like Google does.

There is another problem with marketing and Facebook. Many of the top bricks and mortar stores have closed their Facebook stores. Why ? Part of the reason is that the information on Facebook is too open. Facebook blasts out the fact that you play Bejewel or that you were looking at the adult diapers page on Facebook. I don't want all my Facebook friends to know that. I carefully screen the pics that I put up on Facebook to show that I haven't gained 20 pounds, yet if I am shopping at the "husky" page, my friends will know. Liking the Viagra page will tell my friends that there is trouble in sex department. Looking at the singles ads will let my wife's friends know that I am checking out the menu. I don't want my godson to know that I am turned on by lithe, exotic dark skinned beauties on the Victoria Secrets page.

Facebook crosses too many personal lines. And they don't know how to fence that. Whereas Google deals with pure algorithms, Bayesian inference and data mining. I am reminded of the Target customer that sent a teen some pregnancy coupons based on extensive data mining of the fact that young pregnant women buy some sort of skin cream coupled with a renewed interest in health and vitamins. They had detected the fact that she was pregnant before she told her parents. Google has this capability and Facebook, the way that it is configured, does not. And trying to change Facebook, will be like trying to put lipstick on a pig and taking it to market.

The biggest factor is that everyone is stating that Facebook has unmonetized potential. And they put a high valuation on that. My contention is that the valuation of the user base is way too high. There is a common misconception that every user base can be turned into a marketing base. That is simply not true. The older folks on Facebook just find it an easy way to keep up with people that normally they wouldn't make the effort to do so. But in no way, will they buy anything off Facebook. What the analysts fail to realize, is that many people want a social network just to be social and not to shop. The valuations of the user base are overly optimistic.

So while the emotions of Wall Street may inflate the price of Facebook, I am reminded of what goes up must come down. They don't have the strong basics that Google does of pure substantiveness in their model, and if they anger enough people, Facebook will overnight become another MySpace. Facebook is particularly vulnerable to someone coming along and making something better that doesn't violate my privacy the way Facebook does. You can't knock Google off that way without a billion dollars to do some research and develop some better technology. And when the Facebook collapse happens, we will all wonder why we never saw it coming.

Read More

Invest in Facebook ~ Not on your life

Regular readers of this blog will know that I consider Facebook to be dead man walking. They will become like MySpace. Why? Because they are not making money the way they should. They are trying to monetize themselves and change the way they operate by selling private data. In the words of Jimmy Fallon~ Facebook is selling 330 million shares. Great now you can own a piece of the website that completely owns you.

Not only will they alienate their user base, but they have a couple of problems. First, many of their users are fake. The private data is not real. Facebook themselves will publicly admit that "at least 5%" of their users are fake. Using their figures, that means that 50 million Facebook accounts are fake. I'll bet that the real number is much higher than they are willing to admit.

Secondly, for a billion users, they are only making $3 or $4 dollars per user. That is not enough to sustain the business model long term. Secondly, it tells you that their paradigm is not suited to business. Several Fortune 500 companies have abandoned their Facebook storefronts.

The biggest reason that you shouldn't invest in Facebook, is that the smartest stock player in the world, Warren Buffett is giving Facebook stock a pass. His chief investment officer had strong words about not investing in Facebook. You can read the article by following this link:

http://money.cnn.com/2012/05/06/news/buffett-facebook/

So, that is why I am not investing in Facebook, and it further reinforces my belief that Facebook, like Microsoft, has had its day. The only way to go is down. Microsoft has already turned that corner.

Read More

I Quit Cold Turkey ~ Facebook and LinkedIn

I got rid of my addiction. My Facebook addiction. I have been status-free for two weeks. I have quit my stalker fits. I stopped my furtive network-building on LinkedIn with people I barely know.

Actually it is easy to be smug and liken Facebook to smoking, but there is a deeper reason, and that is privacy. I am a citoyen du monde -- a citizen of the world. I write software for high net worth individuals in Caribbean tax havens. I have written money transfer and micro-payments software for a small developing country. I am currently writing software to fight epidemics in Africa. I have written software for a European Union concern, and I have been requested to do a threat and risk assessment for a UN agency on the African continent.

With the Facebook timeline, geo-location and the selling of data on Facebook, I value my privacy more than knowing that an old high school friend caught a five pound bass yesterday. I don't need a tax agency looking at my Facebook account to try and pinpoint my whereabouts on a specific day. I don't want potential employers to know that I fancy both a single malt scotch and a tropical beer. I don't want to be judged professionally by a vegetarian because I hunt my own fish and lobster on the reef. In short, I want to control my public persona.

LinkedIn is perhaps the most useless social media thing out there. I was an early adopter of LindkedIn, and had a ton of contacts in many countries. I never benefited from being on LinkedIn at all in any way. It was a colossal time waster.

Social media is quite handy for being able to keep track of a large amount of people with minimal effort. However with the ubiquitous selling of data by these social media companies, they are crossing the line in respect to violating my privacy. Using datamining, with the limited amount of data that I put out there, social media can figure out my address, age, buying habits, probable income, and relationship status. No thanks.

What this world needs, is a social media platform that doesn't need to create profits by selling my private information. I wouldn't even mind looking at ads to fund it, however, social media and Facebook is not exactly an ideal platform for selling crap.

If you examine Facebook's reported financials, they make about $4 billion per year or about $4 per user. This is in spite of 33% growth in users. What they don't realize is that if I am stalking my old highschool sweetheart to see if the jock that she married is fat, poor and not interested in her any more, then I really don't want to buy anything but her love (or eventually Viagra when I get to the stage where I need it).

But back to the point -- I missed it for a few days, but now I find that I have a lot more time to devote to actually generating an income, or making entries in my blog. And being a LinkedIn dropout hasn't hurt my income stream at all. Could this be a trend?

Read More