Today Gigya announced that the company’s Socialize service will begin granting access to the API on Facebook and will integrate with MySpace later this month. The company is trying to bridge the gap for social application developers that are forced to spend time porting their Facebook applications to MySpace. Theoretically this implies that Gigya is also building a connector between OpenSocial and Facebook.

The service also competes directly with Google Friend Connect in that users can access their friends on any site that uses Socialize. Honestly, I’m not quite sure how significant of an announcement this is since the real challenge is sparking developer adoption. All the leading widget platforms enjoy boasting about the impressions that they have (such as Gigya has more than 150 million people that see their widgets each month) but few boast about developer adoption.

This has been a serious challenge for all the widget platforms and will most likely continue to be an issue as larger brands like Facebook and MySpace have been successful at individually attracting a substantial developer base. Another question I have about this new service is whether or not websites cater to both the MySpace and Facebook user bases.

I’d imagine that most developers that integrate with the social graph APIs (Facebook Connect, MySpace Data Availability and Google Friend Connect), will simply select the platform of their choosing. Gigya claims that they already have access to 50 million contacts since the launch of their Socialize service. The main purpose is to organize your friend lists across social networks in a single place.

Their are numerous services which provide similar aggregation services yet many have failed to take off as most users prefer to stick with the big brands: Facebook and MySpace. There is potential for this service to gain traction but for now I remain skeptical. Personally I don’t believe that the solution is to create a temporary offering which bridges the gap.

Now that a company has already done so, there is a decreasing advantage for Facebook and MySpace to remain disconnected. It will be interesting to see if services like the one Gigya announced today will be a catalyst for the progression of data portability.

Statement from Gigya
“Socialize enables website owners to add social features to web sites by making it easy for them to give their user’s access to their friend lists on Facebook and MySpace as well as webmail services. Socialize is not a tool for porting Facebook applications to MySpace. Socialize gives website developers direct access to Gigya’s API for custom implementations, or they can choose to implement turnkey components, hence its direct competition with Google Friend Connect. The announcement is more in the realm of data portability than about OpenSocial and application platform standards. Socialize is a broadening of our product offering beyond widgets.”

This is a continuation in the series on “The Social Web Economy“

I didn’t forget them! I chose to put this last because so often in the social web economy and the general digital economy this is where “average” consumers get placed. Outside of the people and companies that I listed above (who also happen to be consumers), the general consumer frequently gets left out of the equation. The systems are frequently built for the digital experts not for the average Joe.

These are probably the most important individuals in any economy. Without them there are no advertising dollars to be spent. On the social web the users spend their time playing games, viewing media (photos, videos, audio, text) and creating media. All of these things can be boiled down to one thing: communicating. As opposed to traditional media, new media is all about two-way communication.

The products and platforms being built for consumers currently help make communication more efficient.  While in the main economy, consumers pay for their goods and services, most often users don’t pay for products in the social web.  This is because most revenue is driven by advertising.  All that consumers are limited to is attention and that’s what sites are competing for in the social web economy.

While the sustainability of an advertising driven economy is questionable, for now the battle is over attracting the users.  This is the single most significant challenge for any product or platform in the social web economy.  Even if you can get developers to build great products on your platform, there’s no guarantee that consumers will use it.

Next Post: “The Social Web Economy: What Are These People Building?“

This is a continuation in the series on “The Social Web Economy“

You can’t have a good product if it doesn’t look good. While the initial launch of the Facebook platform brought about applications with poor design but broad success, the quality of design has slowly begun to improve. The reality is that designers give products that extra bit of appeal necessary to get users to try it out. Absolutely everybody in the social web economy wants to have a good image and design is the best way to instantly get a great image. While a great logo doesn’t mean you run a great company, having a good initial image is important part of any business.

Since everybody wants their company to look good, designers frequently get to know just about everybody in the social web economy. They design everything from websites to applications, from user interfaces to color combinations, from logos to brochures. Everybody can give you their own opinion on how important design is for your company. A venture capitalist may tell you that having an amazing looking presentation with great slide transitions isn’t as important as having good content. That doesn’t mean they will take you seriously if your presentation looks like a third grader designed it.

While developers are hard at work ensuring that products work properly, the designers are making sure that the product looks good. Interestingly enough, developers are frequently one of the sources of tension for designers. Some times extravagant designers are not easily implemented and as such designers are forced to work with constraints, which is something no designer enjoys.

The primary source of design for designers? Clients. Regularly, a client will come to a designer with preconceived ideas of how they’d like something to look. This immediately places more restrictions on the designer, something I just said they don’t enjoy. You will find designers working within just about all the companies in the social web economy. While you can debate the importance of top tier designers, you can’t debate whether or not design is an important aspect of the social web economy.

Next Post: “The Social Web Economy: Consumers“

This is a continuation in the series on “The Social Web Economy“

Communications and public relations professionals have one of the most interesting positions in the social web economy. The primary role of these individuals is to gain exposure for their clients and ensure proper image. In the past few years we have seen the emergence of a number of firms focused strictly on companies participating in the social web economy or simply looking to leverage the social web.

These individuals typically work for agencies or firms but a few have decided to go it alone, often times resulting in full-time, temporary positions in the companies they are consulting. On the social web, the emergence of influential blogs has transformed the dynamic between journalists and PR professionals.

New technologies have also made it easier for companies to engage directly with their consumers. All of these things have combined to transform the role of the communications and public relations professionals. From helping prepare executives to speak to the press, to engaging increasingly accessible journalists about a negative article, the communications professional’s job is a challenging one.

While communications and public relations professionals are not directly tied to any sort of revenue generating activities, they help protect their clients’ image so that revenue generating activities can go on as usual. The main source of tension for these individuals is with the journalists and analysts, as they are frequently the gate keepers of the client’s image.

Next Post: “The Social Web Economy: Designers“

Yesterday MySpace announced a record breaking month, surpassing 122 million visitors “according to comScore”. That last part of the statement means that the statistics should be questioned. As Caroline McCarthy points out, comScore stated that Facebook reached 144 million visitors. Yesterday though, Dave Morin claimed that the company just reached 100 million users (as Venturebeat points out.

comScore has been criticized for highly inaccurate numbers in the past and the most recent set appears to confirm that. Additionally, having a reach of more than 100 million is significant but when you think about it in terms of the world population, there is still a long way to go! MySpace has been striving to highlight that growth continues internally as they prepare to launch the highly anticipated MySpace music service.

Some could argue that the company’s image has become tarnished as Facebook hogs the limelight as it has surged past all competitors to become the largest global social network. It’s no wonder that MySpace is concerned as all global metrics show Facebook trouncing all other competition. Just take a look at the following Alex chart:

Not everything is doom and gloom for MySpace and painting such a picture would be inaccurate. The company continues to grow abroad and domestically MySpace continues to dominate all the other competitors. When it comes to publicity, the name of the game is continued growth and both MySpace and Facebook have managed to do that is most regards.

While domestic growth has slowed for both, international expansion has provided both companies with a substantial opportunity. As the months pass, analysts and journalists will both be looking for both companies to post stellar growth abroad. Otherwise we could soon hear of the “global social network downturn”!

This is a continuation in the series on “The Social Web Economy“

Analysts jobs are relatively straight-forward: they analyze everything that is taking place in the social web economy and produce reports on them. They can work inside or outside of companies. The companies can be any of the primary companies in the social web economy or they can even work at actual analyst companies (like Forrester Research).

Analysts pay attention to detail and they can also double as a journalist sometimes. Unfortunately for journalists, there are too many stories to write to have anytime to do in depth analysis. Occasionally though journalists overlap with analysts and they end up producing substantive reports. Both journalists and analysts cover their space obsessively.

In my own opinion, the primary distinction between the two is that journalists focus much more of their effort on working their sources and writing articles. The analysts spend a lot more time doing research which can include working the same sources as journalists but for other types of information.

In the social web economy, I would say that one of the most substantial differences in comparison to other industries is how bloggers are accepted as journalists. While they may not always hold the same standard for reporting, blogs have a substantial reach in the technology field. As such web attending any conference that pertains to the social web economy you will see as many bloggers as traditional journalists if not more bloggers.

No matter who they write for, analysts, journalists and bloggers all are important because they help quickly spread information regarding the companies and people in the social web economy. The primary tension for this group is with other analysts and journalists as they compete for valuable information. Additionally, there is occasionally tension between analysts and journalists and their sources as the journalist will push to expose information that the source didn’t initially wish to reveal.

Next Post: “The Social Web Economy: Communications & PR Professionals“

This is a continuation in the series on “The Social Web Economy“

These are the wealthy people in the social web economy. They have a lot of cash on hand from either creating their own companies (or being part of a successful start-up) previously or they were fortunate enough (or not fortunate depending on how you look at it) to become a partner at a venture capital firm. No matter how they reached wealth, they now have access to a substantial amount of money that they like to invest in the five types of companies in the social web economy.

They are looking for a substantial exit down the road through acquisition or public offering that will help make their pockets fatter. In the case of venture capitalists this also means making their investors’ pockets fatter. The investors are necessary though for the most part because they not only bring money with them, they bring experience and they bring valuable connections that can make or break a company.

Whether you like them or not, investors are a critical component of any economy and there is no exception in the social web economy. Investing is also an extremely competitive “business”. While some invest based on referrals, there are other investors that are actively seeking new investments on a regular basis. In the social web economy, attracting the top teams to invest in is an extremely competitive process.

Most of the investments go to an elite group of investors but fortunately for the other investors, not all investments go to the top investment groups. In the current environment there has been far fewer exits than there has been investments. Obviously, exists are alway fewer than the total number of investments but exits have been significantly infrequent in the recent past.

In fact during the second quarter of 2008, for the first time in 30 years, no venture-backed companies went public. This could be a bad sign for things to come but it also may just be an indicator of a poor economic environment. Fortunately for investors acquisitions have provided an equally sufficient exit opportunity. Recently, acquisitions have served as the primary source of exits in the social web economy. As such, IPOs may not be the best indicator for the investment environment.

Whether or not exits or taking place, investors are the primary driver behind growth of the social web economy because they are providing the majority of the cash flow. Hopefully we will begin to see an increase in cash flow from venture-backed companies but for now, this group continues to be the source for growth. That’s why the social web economy needs investors!

Next Post: “The Social Web Economy: Analysts & Journalists”

This is a continuation in the series on “The Social Web Economy“

While they don’t exactly have the same roles, I’m grouping business development and sales people into the same category. Both people end up doing a lot of the same things. The sales person’s primary job is to bring in advertising dollars. Whether it’s brands or advertising agencies that they are talking to, this group is generating the revenue for four out of the five primary types of companies in the social web economy (the only one they aren’t generating revenue for is analytics companies).

Analytics companies may or may not have a sales team depending on their strategy. They most definitely have a “business development team”. For the purpose of this post, the primary difference between business development and sales is that business development (or biz dev) focuses primarily on partnerships with other companies that help add value. Sales teams on the other hand bring in absolute dollars.

In small start-ups, the management team (or individual executive) does most of the business development. Advisory boards and boards of directors can also be leveraged to help perform business development operations. The bottom line is that this group is helping most of the companies in the social web economy keep afloat. For those companies that are in the red, these teams are most likely the ones taking the brunt of the beating after a CEO returns from their monthly board of directors meeting.

In order to generate substantial revenue, companies in the social web economy must have business development and sales teams. While the industry continues to search for alternative monetization models, it’s becoming increasingly clear that advertising dollars are the primary source of revenue. As such, companies are pitting one sales team against another, each attempting to offer creative new advertising solutions that will hopefully in the end bring in the big advertising dollars.

Unfortunately this space is becoming increasing competitive and in turn we are going to see a growing emphasis on hiring the top sales teams. No matter how you look at it, this group is driving the revenue. That’s the bottom line.

Next post in series: “The Social Web Economy: Investors”

Over the past few years, there has been increasing tension among the owners of social networks and the users that interact with their friends via the sites. The primary tension resulted from the disconnected set of relationships across multiple sites and the inability to have a central location to manage our multiple identities. Hundreds if not thousands of solutions have popped up.

Some have come in the form of branded products while others have been categorized as new standards. One thing that hasn’t changed throughout all of the discussion about resolving the problem? A solution. While some of these offerings have a clear advantage over others, none of them have succeeded at attracting mainstream adoption.

Social Networks as the Hub

The best attempt at centralizing the social graph has been Facebook who arguably has the most accurate mapping of the social graph of any of the social networks to date. With their Facebook Connect offering as well as MySpace’s Data Availability product, both companies now have a chance to own our online identities. It is not as simple as releasing the products though.

MySpace released their Data Availability product back in June. As far as I can tell, the service has seen little adoption by developers. While I’m not completely sure about the slow adoption, based on the developers I’ve spoken with, it appears as though Facebook Connect could experience much quicker adoption.

The potential for centralized identities is significant and given their position as the largest global social network, Facebook has a shot at centralizing the majority of users’ identities online. For once, it seems as though there is a company that may actually have the ability to centralize registrations as well as identities and also has the adoption to back it up.

The digital landscape is glorious and simply when you keep everything else constant. Unfortunately things are not that simple.

Let’s Mess Things Up Some More

There are a lot of products on the web that would benefit from having their own social networks integrated into their sites. There are also a lot of brands that would benefit from having their own social networks. It’s for this exact reason that a whole slew of white label social network solutions were launched. Jeremiah Owyang has done the work of compiling a list of white label social networking platforms.

The problem with all of these different solutions is that they each have their own login and their own closed off versions of the social graph. I shouldn’t be letting Facebook and MySpace off the hook though because even their new services result in large, closed-off versions of the social graph as well. The difference is that they actually have a chance at becoming the central location of users’ identities online due to their broad reach.

Last week a large discussion ensued about the soon to be ubiquitous, blog-based social networks. Sarah Perez of Read/Write/Web suggested that the new version of Moveable Type and the upcoming launch of BuddyPress would mark a new era for blogs. Mainly that a large number of blogs will begin launching their own social networks. Duncan Riley provided the counter-argument, suggesting that people don’t have the time to join multiple social networks.

Whether or not people have time, it is clear that the launch of new services by Moveable Type and Wordpress will most definitely complicated central identities further. Moveable Type will claim support of OpenID and Wordpress could theoretically centralize users across all the blogs users become members of. This makes it easy for both to claim that they really aren’t complicating things that much.

Conclusion

The web is still a cluster f*ck. With a bunch of disconnected groups trying to provide centralized identity services and a bunch of disconnected sites and services looking to connect users, digital identities have become even more complex. All the while Silicon Valley thought leaders are struggling to make sense of it all. While there are big players that have a chance at making centralized identities mainstream, we are still at the early stages of these things becoming a reality.

Thankfully both Wordpress and Moveable Type are open-source and as such, it will be trivial to integrate existing services into the site. With the average blogger finding it complicated to modify the code of their site though these things could further complicate our online social graphs. We now have communication among our numerous contacts spread across email, messages on Facebook and MySpace, instant messaging and multiple other locations.

There’s about to be yet another place for those communications to happen: blog-based social networks. How do you think all of these things will fit together? Do you thing blog-based social networks really complicates things?

This is a continuation in the series on “The Social Web Economy“

In order for there to be an economy, there has to be money and advertisers are the ones that hold it. Advertising dollars are probably the most prized possession in the social web economy. Without it there is no business and all that remains is venture capital dollars. The advertisers spend money with four out of the five types of companies in the social web economy: agencies, ad networks, widget & application platforms, and media companies.

Advertising dollars are coming from two primary sources: advertising agencies and from brands directly. While some developers are paying other developers for installations, this amount should be considered negligible in the long-run. Advertisers are the life blood of the social web economy and it is one group of people who attract advertiser dollars: sales people.

So who are the advertising professionals working for? They work for the agencies and the brands. In the current economy they tend to be at the forefront of advertising when they invest advertising dollars in social media. One of the biggest challenges for these individuals is convincing traditional brands that they should be advertising in non-traditional channels (social media). Fortunately for these individuals, within the social web economy there isn’t much tension. Life is nice when you are the one that holds the money!

The primary challenge for advertising professionals is reporting back the results of social media and social networking campaigns. New metrics solutions are emerging to make this easier but the industry still struggles to quantify “engagement”. When you report to a brand that is used to spending money via the television, how do you explain advertising on Facebook’s news feed?

This is an industry wide challenge that all parties need to work together on improving.

Next post in series: “The Social Web Economy: Business Development and Sales People“