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You ARE The Product

2012-05-22 · John · watch on YouTube · Internet & YouTube · explainer learning

Answering Hank's question of how a free Facebook can be worth $100 billion, John argues that free services sell their users to advertisers, that ads do shape behavior, and that being commodified should be a conscious choice; he asks Nerdfighters whether ads should fund Nerdfighteria.

What is said

00:00:00 — Hank's Facebook IPO video ended asking how a free service is worth $100 billion; John will answer

  • ★★ John praises Hank's Friday video explaining Facebook's IPO and stock markets, which ended by asking how a free service he will never pay for is worth $100 billion; John answers that question. — 00:00:00 · Facebook, Hank Green
  • ★ The description points people bragging about using ad blockers to a post on Hank's Tumblr about ad blocking. — 00:00:00 · Hank Green, Tumblr

00:00:24 — Companies that sell you things, companies that sell you, and cable companies that do both

  • ★★ John says there are companies that sell you things, companies that sell you, and a third kind that sells both, like cable companies charging for ad-funded content. — 00:00:25
  • ★ John jokes that cable companies charge about 80 dollars a month for the privilege of watching content funded mainly by advertising. (playful) — 00:00:37

00:00:44 — The internet maxim: if you don't pay, you are the product; Facebook's value comes from its users and their uploads

  • ★★★ John believes the internet maxim: if you are not paying for a service, you are the product being sold. (hedged) — 00:00:44 · online advertising > «if you're not paying for a service, YOU are the product for sale.»
  • ★★★ John says Facebook isn't actually worth $100 billion, but whatever it is worth is because of its users; it could 'MySpace' tomorrow and be worth nothing. — 00:00:50 · Facebook
    • number check: a hundred billion dollars — doubtful
  • ★★ John says this dependence means companies like Facebook, Google, Twitter and Tumblr have to listen to their users, which is good. — 00:00:59 · Facebook, Google, Twitter, Tumblr
  • ★★★ John explains that users' uploads draw other people in, who upload more and draw more, and that uploads tell Facebook what you are tempted to buy so it can encourage you. — 00:01:11 · Facebook, online advertising

00:01:29 — Ads work: advertisers buy you for less than you're worth; $498 billion in ad spending; using free services is agreeing to be commodified

  • ★★★ John says people insist ads don't affect them and they get the better bargain, but that is what advertisers want them to think; corporations know well how ads change behavior. — 00:01:29 · online advertising
  • ★★★ John concludes that, almost by definition, advertisers buy you for less than you're worth, since many people work full time to make ads worth more than they cost. — 00:02:00 · online advertising
  • ★★ John says corporations spent $498 billion on advertising last year: half a trillion dollars says advertising affects behavior. — 00:02:05 · online advertising
  • ★★★ John says everyone using Facebook, Twitter, Google or Angry Birds has agreed to be commodified: not necessarily a bad decision, but one to make thoughtfully and consciously. — 00:02:15 · Facebook, Twitter, Google, online advertising

00:02:27 — The brothers' unease with ads; should advertisers fund Nerdfighteria? Discuss in comments; sign-off

  • ★★ John says the brothers have never been totally comfortable with ads, but ads have seemed the best way to make what they like with people they like. — 00:02:27 · online advertising
  • ★★★ Unsure, John asks Nerdfighters whether Chrysler, super PACs and scammy online dating sites should fund Nerdfighteria and whether to be okay with being the product, to discuss in comments. (hedged) — 00:02:33 · Nerdfighteria

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