The Proprietary Ties that Bind: Part I — Instagram, not the last straw

In yesterday’s New York Times, there was an article about people getting angry over changes to Instagram’s privacy policies under Facebook rule. Rebecca Lieb of the Altimeter Group was quoted as saying

There are always Facebook users who say ‘This is the last straw,’ [but] there’s not a lot of portability. Where would you go?”

That’s rather defeatist. She acknowledges that people are leaving Facebook; others have never even created a profile. Yes, Virginia, there is life without Facebook. Steve once said that when doing a cost-benefit analysis, the option to “do nothing” is often forgotten — i.e., the option to maintain the status quo. But what if the status isn’t quo? What happens to everyone that isn’t seeking the latest and greatest? They keep using the same software despite signs of impending doom.

What keeps users tied to Facebook? It basically comes down to two things: lock-in and the network effect. The lock-in comes from the high cost of switching to another service: the difficulty of copying one’s own data to an alternate service is a large deterrent (although I read that there are services to help with this). Contrast this with Twitter. As more of one’s data is under the control of Facebook, freeing oneself from its grip becomes more and more difficult. The Fong Report noted that the Gardiner Expressway in Toronto was costly to deal with a decade ago but easier, cheaper, and less disruptive to do then; we realized the problem then yet we now we have news items like this. Similarly, leaving Facebook now might be inconvenient, but doing so in the future may be prohibitively difficult.

The second thing that keeps users on Facebook is the network effect. The utility (usefulness) of the network grows a lot for every single person that is joined. But you’re not going to contact the billion (or so) other people/cats/companies/trolls that are signed up. Most people are probably there to contact about 20-50 people and Facebook-stalk another hundred. If most of these people switched to another system with you, you probably wouldn’t care what the other nine hundred ninety-nine million other Facebook account holders are using. And getting a handful of people to switch — especially those people you care about — is a lot easier than worrying about everyone else.

So Lieb is correct in saying that there’s not a lot of data portability. But that shouldn’t stop you from considering alternatives like Diaspora, Bebo, Friendster, e-mail, phones, and postcards.

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