Facebook Blog, Applications and Developers Directory

This afternoon I got to thinking about various opportunities for businesses to leverage Facebook and realized that Facebook is not taking advantage of one of their greatest opportunities: search. A few months ago, Microsoft announced that they were going to begin offering Microsoft Live search results for Facebook as well as search ads. So far nothing has been implemented.

The most important search results on Facebook is people but many users are regularly search for specific products and services within Facebook yet those products and services are not the first results that are displayed. Most often you need to click on the “Pages” tab to find any of the brands or services. In the case that it’s a person, a fan page will regularly show up but this only appears to occur for people.

So how could Facebook help businesses leverage what’s currently an unrealized opportunity? Simple: sponsored results. If I search for “Ford” and was looking for Ford Motors and not my friend who’s last name was “Ford”, a sponsored ad will show up at the top of the search which directs me to the “Ford Motor Company” fan page. I’ve produced a sample image below of what this could look like.

Currently Facebook has the curse of extremely engaging pages. The site is so engaging that most people don’t even realize that there are ads on the side of most pages. The one place where I’d suggest that this trend breaks is when people search for things. At this point there is an amazing opportunity to grab the user’s attention.

How many people are searching for Ford on a regular basis? I don’t know but enough people are writing about it that it shows up in the Facebook Lexicon, which tracks the frequency of words on walls. If people are writing about it, then it’s probably pretty good assumption that they are writing about it. While Facebook doesn’t currently monetize their search, this is a quick way for the company to boost their revenues while they keep searching for a breakthrough advertising solution.

Over the past few days I’ve been writing about the shift of social networks from technology companies to media companies at the Social Times. If you haven’t been paying attention, you might want to check out a post on Techcrunch today in which Mike Arrington argues that Facebook’s lack of a centrally controlled music service is damaging its domestic growth. Last year I suggested that Facebook is supposed to be launching a music service after a source told me that he had spoken with somebody that interviewed for a position to run a music service. Mike Arrington says that it’s now clear that Facebook is sticking with iLike as its music partner. That was emphasized when iLike was announced as a launching member of Facebook’s Great Apps program. Hadi discussed this during an interview with the Social Times. For Facebook to launch their own competing music service would be a bad political move but as Mike Arrington suggests, “Music is such a big category that is so completely dominated by MySpace, that it seems like they should have their overall music strategy under their direct control.” So is music key to Facebook’s domestic growth? It’s clear that music is definitely one way to attract outside visitors. Millions of bands and artists use MySpace as their central location for promoting their work and that means millions of visitors being promoted to the site. Is there another channel that Facebook can target that has the same level of self-promoting activities? Not that I know of. Is there any other group that you think Facebook should be targeting?

New social ad network AdParlor started four months ago with one purpose in mind: to help developers of applications on Facebook and other social networks monetize their apps better. Today, the company has hit an important milestone in its growth: it’s now serving 1 million “quality” impressions daily.

How has AdParlor grown? The platform offers straight-forward demographic targeting capabilities, and allows both developers and advertisers to “tag” their apps and ads. CEO Hussein Fazal says that this matching technology helps AdParlor deliver click-through rates that are “double the industry standard 0.04%.”

“A lot of bigger advertisers are worried about where their ad will appear – which applications their ad may be associated with,” says Fazal. “Our tagging technique can be used using a loose match or an exact match – meaning that large advertisers can control exactly what type of applications their ad appears on.”

Advertisers can but on a CPM, CPC, or CPA basis. Currently, AdParlor publicly offers $1 CPM and $0.14 CPC to advertisers, and $0.65 CPM and $0.10 CPC to publishers. Five different ad units are available.

So far, while AdParlor is working with several agencies, many of AdParlor’s early advertisers are actually other application developers. While the eCPM rates on CPI/CPA ads have proven to perform well in the short term, it will be important for AdParlor to broaden its advertiser base to keep its eCPM rates up in the long term. Fazal says the company only currently offers CPA advertising to other app developers on the same platform - not to external sites.

Two weeks after Facebook launched News Feed filters for status updates, photos, and posted items, Facebook tonight launched new custom News Feed filters for individual applications and friend lists. The new filters are available under the “More Filters” drop-down on the top of the News Feed:

The new application-specific News Feed filters allow users to only show News Feed stories generated by a certain application. For example, here’s what my News Feed filtered by the Causes app looks like:

Friend-list News Feed filters work in much the same way, allowing users to only show feed stories from friends in a given friend list.

Facebook also turned on the “All Stories” News Feed tab tonight that allows users to view a full log of all their friends’ activity.

Overall, central to Facebook’s strategy in the coming years is owning the Feed data and providing a robust Feed experience. All user activity, from engagement with core Facebook services to Platform applications to Connect-enabled websites in the coming months, will flow through Facebook’s News Feed aggregation, selection, and distribution service. I expect Facebook to continue investing in News Feed infrastructure and consumption features to create an even more engaging experience.

In an effort to allow applications to more tightly integrate with the Facebook Events system, Facebook today launched new APIs that allow applications to create and manage Facebook Events from within the application.

Many applications like Party Buzz already add value to the Facebook Events system by aggregating what events your friends will be attending. The new APIs will enable apps to manage those events directly. Facebook writes,

For applications that already have events associated with them, like concert or class applications, now you can easily create and manage events that appear on Facebook, and your users can easily RSVP to these events from within the application. Stories about these events appear in the News Feeds of the friends of the attendee, and the person attending can invite more friends after RSVPing. In this case, you won’t need an active session to create events, since they’re associated with the application, and not the user. However, you’ll still need an extended permission and active session so a user can RSVP to these events.

Details on the API are available in the Developers Wiki.

Facebook’s recent policy update prohibiting incentivized invites, originally announced on July 21, has now gone into effect.

The latest announcement takes Facebook’s February policy update forbidding forced invites further by no longer permitting applications to offer incentives to users for sending invitations to their friends. For example, in game apps where the aim is to accumulate gold, developers have introduced mechanisms whereby users are given more gold for each friend they invite. In other applications, developers have only allowed users to unlocks various features as they invite more friends. Both of these behaviors are now prohibited.

Application developers have been asking for more detail on the Platform Policy in the Developers Forum, and the Facebook Platform team has offered valuable clarifications in responses there. Specifically:

* Facebook says that incentivized invites fall within this policy, but actions within an application do not: “Incentivizing sending a notification is prohibited, but incentivizing an app action (like SuperPoking) is not banned (even if that action typically leads to a subsequent notification). On the other hand, if an app provides bonus points for inviting friends, or just for sending notifications, that would be a violation.”
* Yesterday, the platform team issued this further explanation: “As noted in the blog post, the new policies prevent applications from creating artificial or inappropriate incentives to use Facebook features (including, for example, sending requests and adding profile boxes). Generally, awarding money, or bonus points that can be used to do things in the application or elsewhere, for sending invitations or for the acceptance of invitations, falls under the intended scope of what is prohibited by the policies.”

This new policy isn’t necessarily bad news for developers as some may expect. Facebook is continuing its efforts to improve the quality of messages that applications generate within Facebook communication channels, which should improve the conversion rates of app messages throughout the Platform as a whole.

Kristian Segerstråle, CEO of social gaming company Playfish, welcomes the new guidelines. “We think these changes are an important step forward to improve the overall user experience for games on Facebook and ultimately make the social games market grow faster. We are active supporters of Facebook’s new guiding principles for apps and are working through all our games to ensure we adhere to their spirit,” he told us.

We’ll be staying on top of any further guidance or clarification Facebook issues as it enforces these new policies.

Facebook launched a new kind of ad unit today that has the potential to drive much more engagement than any ad product on the site ever before has: embedded multimedia with comments visible to users’ entire friend list.

Facebook has created new home page advertising inventory with its upcoming redesign. However, this is the first time we’ve seen Facebook fill the sponsored home page slot with this kind of unit. The behavior:

1. Clicking on the ad image opens a video player in-line
2. Comments on the video are visible to your entire friend list.

The comments around the ad dramatically increase engagement with the unit, as the highly visible comments provide an opportunity for users to simultaneously draw attention to the ad by drawing attention to themselves. While this could backfire if comments degrading the advertiser are abundant (I saw a few “LAME!” comments about Tropic Thunder today), the ad comments powerfully take advantage of Facebook’s social dynamics to draw attention to an ad in a way that is impossible without the social graph. When is the last time you heard 9 friends talk about an online ad in the same day?

Ad comments are an interesting step forward in the evolution of “Social Ads.” While this kind of ad may not work as well outside of a few advertiser verticals, I expect that early advertisers will be pleased with its performance.

From gaming conferences to gaming for a cause and from Facebook pets to Facebook movie promotions, here are this week’s highlights from Inside Social Games:

* Space Movers Lets Facebook Players “Game for a Cause”
* Virtual Goods Summit 2008 Coming October 10
* Playfish Keeps Rolling with Pet Society
* Traitor - Special Agent Games Promotes a Movie through Facebook Games
* Videos from 2008 Social Gaming Summit
* Battle of the Bands is Fun but Complex
* Word Twist is Fun, But Could be More Social

In the past year alone, Facebook has more than doubled its presence in Japan and thanks to translating the site into Japanese, the company experienced an immediate jump in traffic only a few months ago. It’s clear though that Facebook’s international expansion won’t be an easy one as it attempts to battle the native social networks. If the hype surrounding Facebook is going to remain though, the company will need to continue posting significant growth numbers abroad, something that has already been slowing according to the most recent numbers from Comscore and Hitwise.

So what will Facebook do to continue their growth? Well, the first thing is to release more languages that are currently in the process of being translated. The second step is to continue to release innovative features that position the company above the competitors. Any other ideas on how Facebook can boost their growth?

As Facebook’s growth domestically has slowed, Facebook has looked abroad for continued growth opportunities. So far Facebook has been experiencing some phenomenal growth, especially in Latin America. Unfortunately though, the spectacular growth that Facebook is looking for in other countries is not coming easily. An Associated Press article this morning highlights many of the challenges that the company faces, specifically in Russia.

Not that the competition wasn’t unexpected but brand loyalty to many of these sites appear to be significant. Just last week I was walking through the Apple store in Bethesda, Maryland when I saw one of the customers browsing Vkontakte, a Russian Facebook copycat. In an article on Techcrunch yesterday, Serkan Toto highlighted why Facebook and MySpace are facing an uphill battle in Japan.

The article compares Facebook and MySpace to Mixi.jp, the current leading social network in Japan. Much of Serkan’s analysis is unfair though because if you zoom into Facebook’s growth in Japan, it is significant as the chart below illustrates.

ast month Facebook released the first version of mini-feed comments. I claimed that it was another step for Facebook toward FriendFeed functionality. Apparently not enough people were commenting though because Facebook has since made a slight change as MG Siegler pointed out yesterday. Rather than displaying a plus sign which potentially didn’t signify “comments” for some users, so Facebook has decided to go ahead and spell it out.

A little over a year ago Facebook opened up their platform and announced an environment free for all developers to come and build on as well as monetize. One year later Facebook is at a crossroads and it appears that they are toning down the free for all mentality that they initially embraced. Numerous companies have built monetization systems on top of the platform and Facebook now finds itself competing with many of them.

In theory and open platform is best for all, especially the consumer but few if any purely open platforms have ever been built into sizable businesses. Microsoft was never shy about involving itself in protectionist measures to promote their own software. Facebook now faces a similar dilemma. It’s clear that their new design is going to negatively impact many of the applications on the platform. Such a substantial redesign of the profile is an almost unprecedented move in an ecosystem with rapidly growing businesses.

At the Graphing Social Patterns East conference two weeks ago, I posed a question to a panel of Facebook executives which essentially boiled down to if Facebook is safe for business. Ultimately I received a non-response from a team of media trained employees. The question still stands and it appears that Facebook is still figuring it out. According to a few insiders, Facebook is regretting some of their open door policies as they learn that large brands have developed large marketing campaigns on Facebook with 3rd parties rather than approach Facebook directly.

In theory though, the focus needs to continue on perfecting the platform. I also have a feeling that we will see this focus continue when Facebook makes their announcements at next month’s F8 event. This focus shines through when sales representatives from Facebook are pitching large agencies. As one agency represent put it, “Facebook and MySpace’s sales pitches are distinctly different. MySpace’s pitch focused on how their platform benefits advertisers. Facebook’s pitch focused on how their platform benefits users.”

As Facebook is subjected to increasing pressure to generate revenue, the company is going to face tough decisions. One of which is how friendly they will act toward companies that have built businesses on their platform. As far as I’m concerned, this may very well be the most important decision for Facebook. Competing platforms have the luxury of determining how restrictive their policies will be.

Facebook on the other hand, has clearly stated that their platform is open for all to compete. While they didn’t proclaim that it would be fair for all to compete, it’s clear that they are now in the precarious situation of changing the platform environment and potentially reconsidering what was once a completely open-door policy.

Those looking for Facebook to transform their monetization strategy overnight and exit with their highly anticipated IPO anytime soon better not hold their breath. Jessi Hempel highlights the challenges currently facing Facebook. There are some serious problems. The most significant is the “blasé attitude that media buyers have toward the company” according to Hempel. Hempel emphasizes that Facebook ads can sell for as little as 15 cents per thousand impressions (CPM). That’s because the rapidly growing user base has its attention elsewhere while navigating the site.

Monetization isn’t Facebook’s only challenge. Zuckerberg is facing more pressure as he separates himself from his college roommates and buddies who were once his closest allies in favor of a more experienced management team. While it shows maturity on Zuckerberg’s part it no doubt causes tension among colleagues, friends and the management. Perhaps reflection is one of the goals of Zuckerberg’s current trip to India and Israel. I wouldn’t be surprised to see continued changes when he returns from his short sabbatical.

There are some big challenges ahead especially considering that not even Myspace, Facebook’s largest competitor, has not yet figured out an effective way for generating substantial revenue. The company isn’t completely troubled though. Facebook continues to see record breaking growth internationally and is preparing to launch the Facebook Connect service which will help transform the social web. In other words the company is facing classic growing pains. It has reached a critical milestone and needs to push through to become the company that everyone believes it will be.

It is an exciting time for Facebook. It will be interesting to see how the company transforms over the coming year.

There is an interesting dynamic taking place in the social web space: developers are being pushed to their limits thanks to the countless platforms that have launched. Only a few large players have been able to adapt. Companies like Slide, RockYou and iLike have enough development power to extend across multiple social platforms and while even their limits are being tested, they continue to emerge victorious with the launch of each new platform.

It isn’t as “smooth sailing” for the majority though. Smaller development companies are opting out of beta programs with Facebook Connect, MySpace Data Availability and Google Friend Connect because they are already stretched thin.

Back in November I asked if Facebook is evil. At the time, the post was referencing Beacon which was eventually killed. For argument’s sake Facebook returned back to being good as it applies to Facebook Beacon. It appears now that the discussion has resurfaced as it applies to competition. Umair Haque states Facebook is “hell-bent not on changing the world, but on dominating it: on playing the cheesy, lame, thoroughly obsolete games of competitive strategy.”

First, I just want to say that a post complaining about competitive strategy on a Harvard blog is pretty ironic in itself. Second, I just want to say that Umair is horribly unfair for singling out Facebook. Facebook is in the process of opening up their platform. They were the first to open an internal platform and they will be the first to open up externally. There is no way in hell that Umair can expect any business to just completely open up overnight as it inherently goes against their own business practices.

Opening up businesses will not take place overnight. Right now the discussion about it is what’s valuable. Is Facebook evil for not opening up completely and letting you take your data with you (in theory completely removing it from their site)? I don’t think so. This is all part of the process, so suggesting that Facebook is evil for not playing under Google’s terms of engagement as Umair does is absolutely ridiculous. We are moving forward, not backward and singling out the one company that helped start this movement probably won’t help things progress.

Last week Facebook said that they would no longer support Google Friend Connect. Apparently there were a number of disputes between Google and Facebook behind the scenes but publicly Facebook claims that they won’t support Google Friend Connect due to privacy concerns. The reality is that it’s business strategy. Ultimately the new Google Friend Connect service acts as an intermediary between social networks and external social applications that reside on third-party websites.

It’s a great notion but the reality is that is reduces the ability of Facebook to track what is taking place on external sites. Tracking the applications on third-party websites is one of the most import features of Facebook Connect. Additionally, applications can update the Facebook newsfeed in turn helping those applications promote external websites. Facebook’s support of Google’s new standard will prevent information from being tracked via the Facebook newsfeed.

While it’s in the user’s best interest to be able to export their friends to other sites, it’s not in Facebook’s best interest to let you do that without them knowing. Why? Well if you go and use your data to participate in other activities around the web, Facebook isn’t able to keep track and in turn their newsfeed can be accurately updated. Is all information about your social interactions going to travel through Facebook?

Not necessarily but as Friend Wilson pointed out yesterday, it’s not the data, “it’s the flow of the data through the service.” If Facebook opens up to Google Friend Connect, it means that social activities will take place on the web under the approval of Facebook but without Facebook’s knowledge of what’s happening. We surely can’t have that happening!

Sure, people have figured out ways to export Facebook’s friend data but it requires a hack and is not technically allowed under Facebook’s terms of service. If you can figure out a way to get that data from Facebook, great! Facebook doesn’t want to openly let other people use data provided by its users to have interactions not under their control.

It’s an ironic position. Facebook opened up their platform and gave developers an almost equal opportunity to compete for user attention. They are about to do this for applications residing on third-party websites as well. In my opinion, Facebook’s concerned that opening up the data completely will somehow reduce their valuation. What I’ve come to realize over the weekend is that it doesn’t. We live in the attention economy and even if Facebook completely opens up, they will still have our attention.

That’s because as Fred Wilson puts it, “provides an incredibly valuable service.” The challenge that Facebook faces is one that many other sites (such as Twitter) face. How do we effectively monetize attention? The television used to place ads in between our television shows but that won’t work in an on demand world. I can’t believe I’m saying this but Facebook may turn out to be the emperor with no clothes.

Facebook has created one of the most valuable communication platforms on the web (outside of their horrific messaging system). This has led them to become one of the leading sites on the web globally. They still face the problem that many other web-based social services face: how do you monetize social? Earlier this weekend I argued that data portability kills social network sites. The reality is that it doesn’t, it just strips of those sites clothes.

That’s the only reason Facebook isn’t going to jump in and embrace total data portability. Would you strip naked for the world to see if you didn’t have to?

Robert Scoble has posted an interesting yet somewhat off the wall post suggesting that once Microsoft acquires Yahoo’s search technology, they will then acquire Facebook for $15 to $20 billion. The acquisition of Facebook has already been discussed among a number of people previously but Robert’s rationale seems a little bit ludicrous.

Why does Robert thing that Microsoft will buy Facebook? Simply because Google can’t currently crawl through Facebook’s website. Facebook can then use Yahoo’s search technology to search within Facebook once it has both groups under its control. While the combined forces makes sense, this is an old way of thinking.

Robert suggests that “we will never get an open Web back if these two deals happen.” Are we really going to turn back the clocks and pursue an AOL walled-garden strategy? It has been proven that this model fails and people end up going elsewhere on the web. Why would it suddenly work this time?

Robert’s apparent conclusion is that search is the killer feature missing from Facebook and once it has it, there is no need to open up. Noticing that Robert’s post was made after 4 AM, I think he may have stayed up a little too late while planning Microsoft’s world domination.

Facebook has been improving upon their new profile design since the beginning of the year. I showed screenshots of one of the new design elements and Facebook has posted other photos on the Facebook profile previews page. When I saw the images that I posted last night, the first thing that I thought to myself is that Facebook is creating a social toolbar that theoretically can be used anywhere on the web while browsing.

If you abstract this a little further, in theory you could have social tags that you use within any design to display social content about a user. On my blog I can put all of my social data by using tags and a simple javascript library that would parse those tags when the page loads (or a wordpress plugin, etc) and it will retrieve that data from Facebook. How did I that data get approved to be displayed on my website? Simple, it used the Facebook Connect service which is soon to launch.

Additionally, data can be displayed dynamically based on the type of visitor that comes to the website. If they are a Facebook user and one of my friends they will see one contact email address, whereas another visitor would see a different email which I use for public purposes. I came to this conclusion because after reading the Facebook profile preview feedback, I’ve realized that not all the users will ever be happy. Is it possible to have one profile design that works for everybody in the world? No way!

There are two options for Facebook: let people customize the design of their profiles or let people extend their profiles to other websites. My guess is that it will be the latter. While I want to own my social data, the reality is that I’m still going to need a single control panel to access and modify that data and determine who has access to that data. If Facebook truly believes that the whole world will fit into their simple profile design, they are honestly fooling themselves.

Have you seen the new profile designs? Do you think Facebook intends for everybody to use the new profile designs or will people be able to make custom layouts outside of Facebook using the data they enetered?

One of the largest benefits for developers building applications on Facebook are the less restrictive policies on the Facebook platform. Well at least the less restrictive policies of yesteryear. While Facebook has increased their restrictions on the virality of applications, there are still relatively few limits on the type of content that can be displayed within applications aside from not displaying pornography. This is in contrast to sites like LinkedIn where all applications are subject to strict approval.

Facebook’s decision to launch their platform with no restrictions one year ago, led to an onslaught of crappy applications. While Facebook could argue that the users are best suited to judge the utility of applications, I’m beginning to think that perhaps some sort of initial filtering process would prove useful. There are some obvious challenges with a system where not all applications are allowed to launch. I’d imagine the chief issue being politics.

I can think of a number of ways to work around this. One solution would be to provide a beta launch during which a limited number of people are granted access to an application. If the application takes off, it is grated global access. Whatever alternative model could be devised, the real question is: did Facebook’s willingness to accept anybody as a developer and approve just about any application backfire?

Laurence Hooper of Loladex things that a “poisoned atmosphere” has been created by the numerous spam applications. As such, it is extremely challenging for utility based applications to gain traction. While I agree with that, there are also other applications that have been gaining traction in recent months. Do you think Facebook’s initial loose limits were destructive to the platform?

When Facebook Pages was released last year, it was aimed at attracting the attention of brand managers globally. With the opportunity to reach Facebook’s more than 70 million active users, Facebook Pages provided a simple solution for brands to reach out directly to their consumers. The way that brands can promote their pages is through the use of Facebook’s SocialAds. Additionally, the branded pages show up when searching through the site.

Facebook also recently launched the Facebook Pages Directory enabling users to browse through the most popular pages. Currently the most popular pages on Facebook include Barack Obama, the Chris Moyles Show, Apple, Victoria’s Secret PINK and The Stig. The most users on any page? Just under 1 million for Barack Obama.

Just last week there was a substantial amount of discussion surrounding Verizon moving their community from their branded social network over to Facebook. The reason provided by Verizon was that they want to “provide our users with the most dynamic and feature rich community experience.” This is a great move but it also raises some other issues.

Conflict of Interest
Currently there is a mini-industry built around the development of custom branded applications on Facebook and other social networks with Facebook being the central hub. As Facebook increases their application restrictions it has become more difficult for many of these applications to spread on their own. Instead brands have been forced to purchase install campaigns which drive users to the applications.

The competitor to install campaigns? Facebook’s SocialAds driving users to Facebook Pages. That means that Facebook is competing directly with some of the companies that are building businesses on their platform. While they have been in direct competition from the beginning, it is now in Facebook’s best interest to reduce the viral growth of applications and make Facebook Pages more attractive.

There are rumors circulating that Facebook will be updating their Pages offering in the near future to make them more attractive for businesses. This is going to end up forcing a lot of the custom development offerings out of the market since it will be easier to simply build a Facebook Page and run a SocialAds campaign.

Is it the New Ning?
Ning currently provides companies with their own customizable social networks. The only problem is that it is frequently difficult to attract returning users if there is not an extremely avid fan base. As such it is frequently better to integrate the networks into communities that already have active users such as Facebook. This is why Verizon decided to shift the location of their company’s branded network.

While Facebook Pages do not provide nearly as much functionality as Ning, they do help users express their branded affiliations, proudly promoting that they are fans of a brand directly from within their profiles. This may be all the branded interaction necessary from a marketing perspective. That’s what Facebook is banking on and as the restrictions on applications increase, Facebook is hoping that the trend toward branded Pages continues.