I have been talking to a number of folks I know who are spending a lot of their time building applications or services for the Facebook platform and I have been struggling to really understand the motivation. Then I read this great post on Andrew Chen’s blog about the difference between people who are motivated by financial gain vs the opportunity to become famous. I would actually push some of his conclusions a bit beyond what his blog post suggests.
It can be rational to pursue “fame” because fame is a valuable complementary good in the tech community – Fame is useful in the tech community, as it is in most community. Fame gets you access to cool people, good ideas, and interesting opportunities. Look at Robert Scoble- he’s famous and he gets access to lots of interesting opportunities due to his notoriety. Being well-known in some area makes it easier to get a job, sell your services as a consultant, get access to smart people, and generally be “in the know” – in short it’s a complementary good for many other traditional businesses.
The vast majority of people who are doing things on the Facebook platform cannot be motivated by the revenue potential – There simply isn’t a lot of money to be made for app developers on the Facebook platform at the moment. I suspect this will change at some point. Even if it does, how will it be distributed? Will the majority of the revenue accrue to the largest of the large, with the smaller providers trying to feast on crumbs? My guess is that the biggest of the big (Slide, RockYou) are in the best position to figure out the business model that works as they have the most traffic, the most exposure, and the tightest links with the platform providers.
Also, it’s worth noting that I am focused on revenue, not “making money” – there will be Facebook apps that get bought for prices where the teams do well. There will also be folks who are able to raise money from angels or venture funds to build applications. I just don’t think the current revenue-generating potential is a strong attraction for most of the people developing these apps today.
The pursuit of fame is driving people to create apps that are famous for being famous. They don’t persist and more energy is being put into driving adoption and installation than actual ongoing usage. This is the one thing that I do find mildly humorous. Perhaps I am being naive, but viral marketing is a tool, not an end in and of itself. Getting reach and adoption ought to be part of your plan, but it shouldn’t be your whole plan. Lately I see an increasing number of applications that have done a great job of being clever in their viral loops and marketing plans but the applications themselves are really disappointing. They’re not that much fun nor do they have much ongoing entertainment value or utility. Simply put, there are a lot of folks who seem focused just on driving installs at the expense of building applications that will drive continued usage once they’re installed. It feels like the ends and means have been confused here.
This whole situation feels a lot like blogging 3-5 years back. A number of folks have built decent revenue-generating businesses from their blogs. A larger group has achieved fame that helps them in their professional life (selling consulting services, their personal job search, finding interesting investment opportunities). For the vast majority, however, the principal return is personal satisfaction and the occasional nod or pointer from a more popular blog. I think we’re already starting to see that with Facebook apps today. We have a few “professional” app developers who are building apps that are engaging and persistent and could conceivably turn into real businesses. There’s another handful of folks who are building apps and have already achieved some level of fame for being “big on Facebook” and have managed to convert that fame into something valuable (angel financing, consulting agreements, conferences, etc). The vast majority, however, are likely going to have to content themselves with personal pride and the joy of the process, neither of which should be undersold.