Crypto EcoBlog
The FAANGs are now MANGA, as Facebook has rebranded to “Meta,” reflecting its evolution to a metaverse company. However, Facebook’s business model remains the same: capturing and monetizing user data, often at the cost of user privacy. Facebook’s privacy record Facebook has long failed to live up to its own privacy promises. The company has repeatedly engaged in data sharing, has been fined for sharing users’ personal information with third parties without permission, and generally failed to protect user privacy. Facebook’s business model is based on gathering as much data about users as possible, monetizing that data through targeted advertising, and selling the information to third parties. Facebook was able to do this because it has near-total control over access
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The FAANGs are now MANGA, as Facebook has rebranded to “Meta,” reflecting its evolution to a metaverse company. However, Facebook’s business model remains the same: capturing and monetizing user data, often at the cost of user privacy.
Facebook’s privacy record
Facebook has long failed to live up to its own privacy promises. The company has repeatedly engaged in data sharing, has been fined for sharing users’ personal information with third parties without permission, and generally failed to protect user privacy.
Facebook’s business model is based on gathering as much data about users as possible, monetizing that data through targeted advertising, and selling the information to third parties. Facebook was able to do this because it has near-total control over access to its service.
For example, the Cambridge Analytica scandal was not an isolated incident. It happened because Facebook failed to properly secure its data, and then shared that data with third parties without users’ consent.
In the 2020 American presidential elections and subsequent Capitol riot, the issues with a centralized platform came to light again: Facebook’s engagement algorithms work to keep people in the same digital “bubbles,” reinforcing their biases and misconceptions.
As a result of its long-term strategy of gathering as much user data as possible for targeted advertising, Facebook has amassed a large trove of data about individual users. And because the company controls access so tightly, even when users take steps to limit the use of information by third parties in their own profiles, Facebook still collects the data itself and sells it.
Facebook’s business model depends on collecting this data. Its revenue stream depends on selling targeted advertising based on its understanding of individual user behavior. This requires extensive tracking and analysis of individuals’ behaviors across all aspects of their online experience—including beyond Facebook.
In other words, on Facebook, you, as a user, are the product.
The central role of data in Facebook’s business model is laid bare when you consider how the company makes its money. In 2020, it was found that around 98% of Facebook’s revenue is generated from advertising—in other words, from the sale of user data. The remaining 2% comes from payments and other fees revenue. This means that most of Facebook’s revenue comes directly from the collection and monetization of user information.
The move to a “metaverse company” just means that Facebook will capture even more of your data.
What’s the alternative?
There is an increasingly small number of massive companies that gain control of most online activity—and thus large swathes of society’s economic activity flows through these companies.
These companies are able to collect vast amounts of data about individual users across multiple platforms, so they can create highly targeted advertising campaigns for their products or services. The user has very little choice in where this money goes, since most online transactions are facilitated through these companies. Users often find themselves passively providing value for free in exchange for targeted advertising messages.
Fortunately, there are alternatives, and it comes down to the concept of “decentralization.” Decentralization is the process by which information is replicated and stored on many servers rather than centralized, controlled by a single entity. It also means that users retain control over their own data, rather than it being controlled by a corporation.
One metaverse project, Next Earth, is building a decentralized network that aims to be the infrastructure for an open, equitable, and censorship-free online world. Users retain control over their own data, rather than it being controlled by a corporation.
Next Earth is an NFT-based replica of our planet, where users can buy virtual land, create land art, and trade with others. These assets are owned by the users, not by the company. The Next Earth economy provides a way for users to monetize their metaverse experience, whether it’s selling a virtual Statue of Liberty or a pixel art recreation of the Mona Lisa, without sacrificing control over how their data is used, or by whom.
It’s time for society to demand more control over the use of our data. It should be the norm that users own and control their own data, rather than it being controlled by corporations
Photo by Glen Carrie on Unsplash