William of Ockham and Your Facebook Data

I’m just going to come right out and say it: I think we should all be paid to use social media.

Do I have your attention? Okay, good. Now let me back up and explain where I’m coming from.

In a lot of ways, social media works just the same as any other industry: Raw materials are used to build a finished product. In this case, the product is…well, advertising. That’s how social media companies make their money and stay afloat.

So what’s the raw material—the input and resources needed to make that finished product? I would contend that the raw material for social media is our data. Yours. Mine. Anyone who uses the platforms.

After all, without users on the platform, there is no platform. Without data from individual consumers, there’s no way the “free” services of Facebook and Twitter can be monetized through advertising. Without us, there’s no social media—plain and simple.

So why is it that social media is the only industry in the world where the raw materials are not compensated in any way?

Take this example. Say you work in lumber. You can’t just snap your fingers and have lumber appear. You need trees and you need land, neither of which are free. And if it doesn’t rain, you have to water those trees. Again, not free! There is a cost involved in acquiring the raw materials and converting them into the finished product.

Yet in the world of social media, you have an entire economy that’s monodirectional. We provide the raw material. We provide the data that’s needed for the enterprise to be lucrative. Without us, social media is nothing. And yet, we’re not compensated for the data we provide.

Here I need to bring William of Ockham into the conversation. You’re probably familiar with Ockham’s Razor, perhaps the most misapplied and misquoted truism in all of Silicon Valley. But really what it boils down to is this: The most effective and efficient way forward is usually going to be the simplest one.

As our culture wrestles with the role social media plays in our lives and in our democracy, I can’t help but feel like we’re reaching for some of the most complex solutions possible. You think government regulation is going to offer an easy way to keep social media in check? Good luck with that.

So what would Ockham say? Well, I’d argue that the simplest way to better regulate the social media economy is to treat it like we would any other industry…and that means paying for the raw materials.

The compensation, I think, would have to be based on both the volume and the value of the data produced. Here’s what I mean. The data produced by some anonymous online troll really isn’t valuable at all; it doesn’t tell advertisers anything they can use. But real information from a non-anonymous individual? Now that could have huge benefits to advertisers. That’s the kind of data advertisers already pay for in other contexts. All I’m suggesting is, we apply the same standard to the data accrued through social media.

More than 100 years ago, John Wanamaker proclaimed, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” (Research on programmatic advertising bears this out.) If advertisers want to know where their bucks are actually going to good use, there seems like a pretty obvious solution: Pay for some meaningful data.

One of several upshots I can think of is that this would devalue anonymity. You want to get compensated for your data? You can’t hide behind avatars and fake names anymore. That in itself would solve a lot of the problems we’re seeing with the social media ecosystem.

And there are problems—real ones. But I think there are also solutions. And as is so often the case, the best solutions are the simplest ones.