Interesting debate during this morning's monthly meeting of Social Media Charlotte, the networking group where marketers, new media folks and anyone interested in Web 2.0 kibitz over coffee. I was intrigued by one of the questions put up for debate: Is the social media bubble about to burst? Adam Holden-Bache of the Mass Transmit internet marketing firm and ad-man Jim Mitchem of Boxman Studios said yes, and noted Goldman Sachs recent buy-in deal with Facebook that valued the network at $50 billion. They drew an analogy to the bursting of the dot-com bubble a decade ago. "At some point," Holden-Bache said, "this is going to have to correct itself."
No way, said Lisa Hoffman, a social media specialist with Duke Energy, and Lyell Petersen, internet marketing director with iCruise.com. They suggested the social networking fever might be leveling off, but social networks aren't an industry (i.e., subject to boom and bust cycles). They're a means of communication. Weaker social networking companies might wither, but the media form is here to stay.
The presenters, in keeping with the format for the event, took their positions purely for debating purposes, and didn't necessarily subscribe to their assigned stances in real life. (Note to organizers: more debates please!). Still, given all the light and heat surrounding social networks, they raised a very interesting question. I tend to think there's no real bubble-bursting to come, aside from the normal rise and fall of markets and companies. Once they gain traction, mass media formats don't ever seem to go away. I'm pretty sure even newspapers, for all the hand-wringing over their decline, will still be around 50 years from now. Social media's not going anywhere, either.
What do you think? Do you expect you'll still be Facebooking 20 years from now?
Thursday, February 17, 2011
Social media 'bubble' about to burst?
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21 comments:
Eric, thanks for attending today. It was a fun event and great format—I was glad to be part of it!
I thought we had weighed in on this tired debate enough by now. There are zealots that will defend Facebook til the end of its fad-ridden life, and then there are those of us who think it is nothing but a waste of real life that sucks people in like drug addicts. The addicts will never listen to anyone who isn't absolutely obsessed with Facebook.
Fine, let them continue their teenage-like fantasy of living online instead of the real world. As to how long it lasts, well...I'll have a chuckle on that and we can get back on that in a couple of years and see. Meanwhile, I will be out talking and interacting with real people, face to face and enjoying life!
Eric - great to see you this AM and finally meet you in person. So nice when you can put a face to a name which is what these events are all about. Bringing to the social to social media. Looking forward to seeing you at the next one.
Like all new media formats, social media has had a rocket-like take-off and must some day fall to earth.
I agree with Eric that people will still use it. But I did read somewhere that Twitter loses half of its subscribers every month. Is that right?
They "kibbutz over coffee"?
"Kibbutz" usually refers to a Jewish settlement or gathering...it isn't normally used as a verb.
I think you mean "kibitz", don't you?
"MySpace"
I'm surprised to hear that some folks think social networking like Facebook is going to disappear. Though I guess there were some who said to Gutenberg: "That printing press thing is just a fad. When that's over, people will go back to what's best: passing news and information word of mouth. Nothing will ever replace that."
I only make up that example because I'm not taking the time to think about all the other changes that have been pooh-poohed in our lifetime: ATM's ("who'd want to use a machine instead of a live teller?"), cell phones ("I don't need to pay for that when I can make a call anytime I want for only a dime -- payphones are everywhere.") etc, etc.
"They suggested the social networking fever might be leveling off, but social networks aren't an industry (i.e., subject to boom and bust cycles). They're a means of communication."
Social networks != social networking tools and technology. It always amazes me how people conflate the two. Facebook, Twitter and the rest of the technology firms are at the very least a segment of the media industry (a segment that exploits social networks) and very subject to economic cycles. That doesn't mean they're going anywhere... we still have dot coms and housing, after all.
........and two the last two commenters: you missed the point. It was whether the bubble was about to burst. Things could still be used down the line, maybe, but to those of us who are old enough to know better....it doesn't mean they will ever be the big thing of the moment again. I think what the person said earlier is accurate: no facebook lover will ever accept any negative criticism about it. It is an obsession, and we always know how those end up! Good luck with your dream that everyone is on facebook, for it is just not so. It may be the thing of the minute, especially for teens and students to young adults, and maybe even to other adults who just can't socialize in real life. So be it. That still doesn't mean much in the great scheme of things.
People are using the wrong terms here. Social Media, I don't think is going away. Platforms like Facebook, Myspace, etc are the things that come and go. Facebook will stick around for awhile until something new and better replaces it.
Just clicking on this always amuses me. There are so many people I know that could care less about Face book, or any other name it's called now or down the road.
I don't think that Facebook is a fad, just a new thing that will lose some of its luster over time but will still be used. I can take or leave Facebook; I'm not tethered to it and only check it once in a while. What I am addicted to, however, is reading a good old paper copy of the Observer every single morning. I don't think that will ever go away either, even though lots of people think it will. There are too many people like me who still like to turn a physical page. It gives me a certain satisfaction, something that reading the paper on my iPhone can never do. I know--I've tried.
You guys are late to the party. It's already burst. next
Facebook's bubble has already burst. It's still useful, but Zuckerberg's dream that it will connect to everything and that people will use it for everything isn't going to be as big a deal as he thinks. I don't think people want to share as much as he thinks they do.
You're right, 2:55
AOL thought everyone would connect to them to get to everything and look how that turned out.
Does anyone remember the CB radio craze?
That, and have you tried to "wire" a "telegram" lately?
.-.. -- .- ---
That's LMAO in Morse code in case didn't know...
Eric-
Thanks for the recap. Although I debated on the side of the bubble burst, I'm more in line with you. I think a "correction" of sorts will occur, especially to those companies that don't have a solid revenue model. Facebook is profitable (albeit only slightly) but overvalued, so over time the valuation will evolve into a more reasonable figure. The companies at biggest risk are Twitter, Tumblr and others that haven't shown that they can make money. Yet.
One thing to consider here is that over the past 10-15 years, the giants of the industry have all come and gone within a few years. AOL, GeoCities, MySpace and others have risen, peaked and failed. Everyone thinks this won't happen to Facebook, but history shows us it is likely that it could. But until then, we'll just keep Liking everything and see how this all plays out.
Thanks for attending and sharing your views!
Oy vey! Anon 12:44, you are correct, I did indeed try to force people onto a kibbutz when all they wanted was to kibitz over coffee. Thanks for the correction!
Thanks for covering the event, Eric. We enjoyed experimenting with the debate format.
I believe all the references to MySpace, AOL, Geocities, etc. are all evidence that businesses come and go, but social media (or websites or Internet marketing or...) remain part of our lives. The disappearance of a once-hot site doesn't mean a bubble has burst...or that social media is a fad...but merely that the site in question didn't survive.
Is social media a fad? Maybe, maybe not. Even if it is...so what? It may turn out to be a long-term fad, or it may fizzle after a short run. Either way, it's here now, so why not make the most of it?
I appreciate the remarks of your readers who cite telegrams and CB radio as proof that social media is a fad. I think "phase" is a better term. But whether it's a fad/phase or not is a very different question than whether we're headed toward a bubble. Bubbles are serious financial events with sometimes disastrous economic consequences.
And on that topic, there's clearly plenty left to debate.
The thought of a social media bubble just occurred to me, independent of reading about it. I've been using twitter a lot, trying to start a new blog. And it just occurred to me, I believe we are in a social media bubble. And like all bubbles, no one knows exactly when it will burst. Not that it matters to me, I just think it's interesting.
I think this could be true, if the popularity starts to dwindle. There soon or always will be things to build on. I believe to use these social media outlets, you need a decent Computer like this one: http://www.charlotteobserver.com/classified-ads/ad/1333869. Anything less would be dumb.
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