Social networks have a lifecycle: They start with a small core of early adopters, swell as mainstream users get pulled in by their friends, and then see growth taper off as people get turned off by spam. That's why Friendster is forgotten and why MySpace is looking increasingly stagnant. The price for reaching an audience advertisers care about seems to be a site users can't stand. Facebook, however, isn't following the fashionable trend.
The Barnumesque blather of Facebook's platform evangelists is matched only by the bombastic inclarity of Salesforce.com CEO Marc Benioff. How fitting that the two companies came together earlier today to obfuscate their joint efforts. When Facebook agent obscurateur Dave Morin posted about the incident, his colleague, engineer Luke Shepard, bravely scratched his head in public, on Morin's Facebook profile.
Many developers are giving up on Facebook's third-party applications platform, finding it too hard to follow the social network's strict rules for programs which piggyback on its lists of friends and news feeds to find new users. But one application has thrived: Joe Green's Causes has seen traffic triple in the past month, helped in part by interest in the election. But only in part.Causes, Inside Facebook notes, is part of Facebook's "Great Apps" program — handpicked applications which enjoy special treatment from Facebook, including more frequent appearances in users' news feeds. What makes Causes a Great App? One hopes it doesn't have anything to do with Green being Facebook CEO Mark Zuckerberg's Harvard roommate. (Chart by Inside Facebook)
It has taken Facebook more than a year to pick the 25 winners of its FBFund grants competition, who have received $25,000 prizes. And now those 25 can try for $250,000 more, according to Facebook's FAQ: "The top 25 applications [in round I] will receive $25k grant. After Round I the top 25 may resubmit to apply for one of five $250k grants awarded in Round II." So if you win both grants, you get $275K, right? Wrong!By Facebook's math, one $25,000 grant + one $250,000 grant = a total of $250,000. In announcing the Round I winners, Facebook's Catherine Lee pulled a $225,000 figure out of thin air: "Once round two closes in December, we will announce our five finalists, each of which will receive up to an additional $225,000 in funding." I'm sure Facebook flack Elliot Schrage has some highly entertaining explanation for this which he will deliver straightfaced to other reporters, who will then call us and howl with laughter. For now, we're content to just blame Sheryl Sandberg.
BarTab. Thankster. Daikon. Pongr. Newsbrane. Faithfeed. Koofers. Say the names of the apps which won Facebook's application-writing contest out loud, and you instantly understand what a joke the process must have been. What's really funny is how long it took Facebook's grants committee to arrive at this list of 25 winners, who will receive a second round of $25,000 grants from Facebook's FBFund and "mentoring" from Facebook employees. (Sadly, no therapy is included.)Facebook had first promised an announcement for September 22, then October 10. The results finally came today — only after Valleywag pointed out the ongoing delay. Facebook is now spinning the "amazing diversity" of its winners. Translation: They gave up and picked them at random. A suggestion to Facebook's grant-granters: If no one deserves a prize, it's totally okay not to give one.
Silicon Valley's bubble in Facebook-apps startup has been our own local version of the crisis in toxic mortgage securities. With venture capitalists growing leary of the concept, developers have been eagerly awaiting the outcome of Facebook's FBFund, a grants program for applications startups. Results were promised on September 22, then again last Friday; Facebook still hasn't made a decision on the lucky winners. Why? Because Facebook's applications platform has become, like everything else in the company, a scene of rabidly intense politicking.Here's an update for anyone who didn't get the memo: Facebook's applications "platform," a set of software tools for embedding timewasting entertainments within the social network's pages, is not a level playing field. Some applications are more equal than others. That's only become clearer since Facebook foolishly put Facebook's platform in the hands of its top flack, Washington-trained bloviator Elliot Schrage. Facebook's Great Apps program, meant to designate higher-quality applications, has become a shameful excuse for nepotism. Awarding money on the merits is hard enough. When you mix in the need to help out your COO's brother-in-law's pet startup, or your ex-president's latest venture, it complicates matters. Is Facebook going to come out with a list of apps to fund that it's truly proud of? Or will this look more like an appropriations bill after it's made its way through Congress, larded with earmarks?
Slide and RockYou, the two largest developers of Facebook apps, have long had a serious rivalry over the most frivolous Web software. But the two may be pulling apart. Slide, Max Levchin's SuperPoke machine, signaled yesterday that it's betting on online entertainment, partnering with Hollywood to bring mainstream content to its FunSpace apps. RockYou, meanwhile, seems to be turning into a gamemaker. "We want to be like the Electronic Arts of social networks, and build games for social networks," RockYou CEO Lance Tokuda, shown here, said today at the Startonomics conference in San Francisco, referring to the dominant maker of videogames.Build, or perhaps buy. In July, RockYou acquired Speed Racing, one of the top games on Facebook. But RockYou, in diverting its attention from its rivalry with Slide, will face well-funded competitors in startups Zynga and SGN. By the time all this becomes a serious business, isn't it just as likely Electronic Arts will be the Electronic Arts of social games?
A tweak to Facebook's new site redesign, which goes permanent today, removed a link to "recently used applications" from the site's applications drop-down menu. Its got the third-part developers who make those applications up in arms because they say removing the link will make it harder for users to come back to their widgets. One developer wrote us to say "if this sticks today marks the end for 3rd party applications." The "Developer Feedback to Facebook" forum is full of similar complaints. "I already have users complain that they can't find apps again on the new profile after first using them. the latest changes will make it even harder," writes on developer. Another: "Yup, this is a very intense change. And pretty useless from a user experience point of view. Hopefully they roll it back immediately or it was just a mistake."
Sequoia-backed RockYou, the second-largest widgetmaker on Facebook, is considering plans to staff a New York office with 2-5 ad salespeople — copying a move made by archrival Slide two months ago. Funny, it normally doesn't take these two so long to imitate each other. It's a much-needed move: RockYou has a reputation for being slow to respond even when advertisers come knocking on its door. The startup has been content to coast on charging other appmakers for promotion, and we hear it's on track to take in $10 million in revenues this year. But at some point, the company will have to give up that business model — which strikes some as suspiciously pyramidal — for legit dollars from Madison Avenue.
At a recent party to celebrate developer Joe Hewitt's latest release of the Facebook application for the iPhone, friends treated Hewitt to champagne and a cake decorated with, naturally, an iPhone running Facebook. Of course, moments later, pictures of said cake showed up in partygoers' news feeds and were automagically displayed on their iPhones. And you doubted the power of technology to change the world for the better.
Today at Facebook's developer's conference, social games widgetmaker Zynga will announce a $29 million round of funding — the company's second — led by Kleiner Perkins, the VC firm that backed Amazon.com and Google. Zynga has also acquired virtual world app YoVille and added former Electronic Arts creative exec Bing Gordon to its board. The company makes games like Poker and Attack, a Risk clone, for Facebook and other social networks. Zynga founder Mark Pincus told the Wall Street Journal that Zynga has 18 million monthly visitors and adds another 450,000 users a day. Kleiner Perkins partner John Doeer said his firm went ahead with the Zynga deal because of that kind of growth, telling the Journal Zynga has "cracked the code" on how to develop games that go viral fast. But really, how Zynga adds new users isn't all that complicated, clever or sustainable.
COO Sheryl Sandberg and PR chief-turned-platform politician Eliot Schrage, Facebook's no-fun adults, are fully in charge of Facebook. The latest evidence? Facebook's second annual F8 developers' conference has another "hackathon." But unlike last year's all-night session, it hardly deserves the name. It starts at 3 p.m. and ends at 11 p.m., presumably so Schrage can go home and get a good night's sleep before calling reporters on the East Coast to tell them of Facebook's fabulous new platform achievements. Developers are still raging about the notion that Schrage, a PR guy, is in charge of Facebook's development platform. At a recent party in San Francisco, Ben Ling, the technical guy behind the platform, was spotted rolling his eyes when Schrage's name came up.
Facebook will follow its F8 developers conference this Wednesday with another 8-hour "hackathon" for third-party developers and Facebook engineers to work on widgets. This will be fun to watch, because those two groups kind of despise each other right now. Last spring, Facebook began taking a hardline stance against widgets that spam users or violate privacy rules, even going so far as to temporarily remove popular apps like Top Friends and Super Wall from the site this summer. Then, a beta test of Facebook's new profile revealed a new feature that made Slide's Top Friends redundant. Slide responded cheerfully to the news, but one exec at a widgetmaker told us that if Facebook keeps up the regime of enforcement and copycat apps, venture capital for Facebook-focused startups will dry up. Of course, we hardly expect a brawl or even public arguments during the "hackathon" — passive-aggressive Twitter notes and other forms of repressed resentments, anyone? Developers, save yourselves the future therapy bills. Just do what Facebook wants and build the kind of apps its employees describe in the video below. That seems easier.
Over the past month, Facebook has shown itself to have a quicker trigger when it comes to banning applications from its site for rule violations. It's part of the reason, observers say, that venture capital for Facebook-app startups is slowing down. The punished include apps from major developers RockYou and Slide. But they also include guys like developer Dan Abelon, who saw his popular SpeedDate widget booted from the platform for a couple hours earlier this month. Abelon told Inside Facebook what other application developers should do to make sure the same doesn't happen to them. The bullet points — which paint a picture of Facebook as a fairly ruthless enforcer — are below, trimmed to give widgetmakers more time to call those VCs who suddenly all seem to be on vacation all the time.
Facebook will not launch a payments system for its platform application developers at the upcoming F8 conference. Inside Facebook says though Facebook engineers are working on a system, it just won't be ready in time — even though Facebook began asking developers to participate in a payments beta test last December. Silicon Alley Insider offers a stranger explanation: The Facebook payments system hasn't come out yet because Facebook founder Mark Zuckerberg "hasn't bought in to the idea completely."
They can't say they didn't have it coming. But widgetmakers are angry all the same about Facebook's decision to clone Slide's Top Friends application as a feature in its latest redesign. "It would be insane for a new developer" to begin creating new apps the platform now, says an executive at one of the many Facebook-applications firms watching the story. The exec says the VCs widget startups pitch for funding know it, too, and are closing their wallets. He blames Facebook's "new regime," including new COO Sheryl Sandberg and recently-appointed flack-cum-platform director, Elliot Schrage: