I listened to the Meta investor call that forms the bulk of the article and for what it's worth, Zuckerberg framed the low monetization as a conscious part of their product strategy -- that they spend long periods refining the experience with little consideration of ad revenue, and then only afterwards, as a somewhat separate endeavor, begin to investigate ways to monetize efficiently. They've been hugely successful rolling out successive products/experiences in this manner.
A lot of the perceived gap between short-form video and other social media's profitability can likely just be explained by TikTok's relatively nascent ad platform -- you could substitute TikTok with Twitter and make the case that it's text-based social apps that are worse ad businesses. My guess is it's more about the ad infrastructure itself than the experience you're bolting it on to.
But it's also interesting to think that TikTok made a product that's too good at retaining users' attention, such that they can't be tantalized by an ad to interrupt their addiction.
> Zuckerberg framed the low monetization as a conscious part of their product strategy -- that they spend long periods refining the experience with little consideration of ad revenue, and then only afterwards, as a somewhat separate endeavor, begin to investigate ways to monetize efficiently.
Also known as stage one of the enshittification process:
> first, [platforms] are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves.
Stories is the one that comes to mind for me. Another product that was shamelessly replicated from a competitor, but refined under FB, and now represents a meaningful proportion of the platform's ad revenue.
And I know you specified launches in the last couple years, but just doing some back of the envelope math, some 60 percent of the world population where Meta isn't banned are MAUs across their family of apps -- hard to argue against their broad consumer adoption generally.
I hate to be this guy, but if user was not sufficiently satisfied, the user would not keep using it. I am saying this as a person, who does not like social media.
As an anecdote from an average-joe consumer - I don't think I've purchased something from a banner ad in my entire life, but in the past couple years I've bought mountaineering glasses, a bomber jacket, and a corduroy hat with a beaver on it after having seen the ads enough times between Instagram stories. Is it anything special I couldn't have gotten elsewhere? Of course not, but that's the trick of advertising, reminding you of products you'd forgotten even exist.
I think it will take a few years for the data to come through and for ad agencies to fully wise up, but I'm convinced that short-form video is THE fertile ground for advertisers at the moment. There's an entire generation of consumers who never watch broadcast TV, never buy magazines, and don't spend much time browsing the regular web. Short form video ads are in many way the ONLY way to reach them, and based off the amount of stuff I see my teenage cousins order, I think it's working as designed.
It ultimately comes down to covering a wide range of sources. Maybe I get used to seeing the same things in one channel, and then all of the sudden I see a billboard for a product I wasn't expecting. And then maybe I see that thing in a random magazine at the dentist's office. Now my decision fatigue is really wearing thin or maybe I think "I'm meant to buy this thing!" (kinda ridiculous I know).
I still haven't heard any convincing reasoning for banning TikTok besides Western companies being salty that a Chinese product is beating them in the free market.
> TikTok could become really important, really fast. We shouldn’t let things get to that point.
Twitter was and is still very, very popularly used to get immediate news in the event of domestic and international emergencies and it still is at this point considering it is used as a platform which agencies can use to convey information quickly and have it retweeted.
Anyone who has been on Twitter recognizes this. You can still find first-person POV from users in some really interesting situations that would otherwise not be shown on mass-media networks due to regulatory controls on what can and can't be shown.
Does that validate the use-case in Twitter being banned? Let's say the new owner doesn't want to show reporting from what is happening in Eastern Europe - does that further solidify an argument that it should be banned because it has been 'weaponized'?
The author at no point references Twitter in their article and just continues on a narrow lens on the subject matter.
What is the value in banning an app in a shroud of hypotheticals?
It didn't make a lot of sense. It was a weak argument. Until I got to this part:
In other words, even if the TikTok issue seems largely symbolic right now, the app’s dominance of American media gives China’s government a considerable amount of option value in the event of a crisis. TikTok could become really important, really fast.
In other words, it could be bad at some future time. But the US is overwhelmingly supportive of Ukraine (and there is a lot of pro-Ukraine content on TikTok) and Taiwan. Americans broadly understand these are democracies under threat and deserve support. TikTok is not in a position to change those perceptions.
Thanks for sharing. I read through the sources in the article.
> Toward the end of the 45–minute experiment, analysts’ feeds were almost exclusively populated with both accurate and false content related to the war in Ukraine
A DoD funded company says that new accounts on TikTok were exposed to correct and incorrect information the Ukraine war. This is going to be true on any social media app in the entire world.
> For years, lawmakers and commentators have feared that the Chinese government could use TikTok — which is owned by a Chinese parent company, ByteDance — to secretly distribute content sympathetic to the Chinese Communist Party in order to shift public opinion in the United States.
Former employees of a separate app that shut down 3 years ago claim they were told to pin videos of pandas and tourism in China to the front page.
> TikTok can collect, which includes faceprints, voiceprints, browsing history, text messages, and pretty much anything you do on your phone
Again, not unique.
Do I like TikTok? No. But I don't think hypotheticals are enough reason to ban it. I think this is a very similar scenario to the 2016 Russian misinformation hysteria that was ultimately mostly unfounded.
I think you're being just a bit disingenuous, but I somewhat agree with the message, if not the spirit, of what you're saying.
What we should be banning is behavior, not authorship. Does the application retrieve user data? What data? Is that retrieval bad and user hostile? Ban that behavior. Does the application do something else bad? Ban that behavior. Banning something simply because it's controlled by a government we don't like is a bad precedent. We should do the work to describe what specifically the application is doing that we don't like and address that, because it would also have the effect of applying consumer-friendly laws to all the others apps doing that as well with the goal of making ad revenue and not just collecting information for a hostile government.
I believe the issue is that were we to ban based solely on behavior and not country of origin, we'd have to ban every single social network in existence right now.
And probably many, if not most traditional media outlets too.
Maybe a few hundred other ad and personal information sales supported applications.
There are very few good actors on the internet today, when you evaluate them based on the behaviors you mention.
1. CCP has control and data access to China companies. Ppl need to beware that's how CCP works. They insert party members into the companies and can take control of the companies at will. If you don't believe me, go look it up. Also ask Jack Ma how is his holiday
2. Many products are banned in china (google, twitter, facebook, whatsapp, github... etc). And CCP bans at will. Maybe a bit of retaliation is justified?
Oh no, the evil CPC will know what shitty dances American teenagers are doing.
They aren't banned "at will" they were banned for violating Chinese law by refusing to remove illegal content. You can disagree with those laws, but calling it "at will" is disingenuous.
It is not a free market. TikTok has access to a billion extra users that the rest of the world does not have access to. That enables easier testing of features, lower margins, and more content.
A country should only allow foreign businesses in from countries that would allow that same business in from our country.
Pretending the CCP subsidized enterprise is a free market is just wrong.
A perfectly reasonable argument would be that China doesn't allow American companies to freely compete in their country and we should therefore maintain duly reciprocal treatment.
Exactly. This sentiment is the general problem with China. They expect the world to bend over backwards to accommodate them and their economic goals while allowing none of the same reciprocal treatment with other countries. They want all of the upsides of being a larger player on the global stage while accepting none of the downsides. You can't have it both ways.
That's true across a broad set of economically more significant domains than social media. But there is no moral panic over (shoddy) Chinese trains on the Orange Line.
I work in advertising and we've found that ads on Tiktok are expensive to produce and also get less engagement than other social media companies. I enjoy Tiktok as a product but I'd love to see conversion metrics across the platform.
I think that is something which has been in the background over there for awhile now considering their plan has always been to replicate the success in e-commerce in the Asian market [1] by expanding it to include the US/EU market [2]; to that end they also began to build fulfillment centers in anticipation [3] but I don't think it's had much success as of right now.
I imagine they are still very eager to shift into that type of model since the format does present some real potential in generating conversions. If you've done the ads where the user can 'swipe' into the e-commerce shop those seem to work really well for makeup brands from what I've seen.
Sources, if anyone is interested in checking out what I mean
I train market mix model for high level attribution for US companies and it usually looks like TikTok doesn't have a strong impact on revenue compared to how much is spend on it. Might be that there is some reason that the model doesn't view them as strong and I am planning to carry out a couple of incrementality tests to see how true that is.
The only thing tiktok broke is the revenue model of incumbents. TikTok offers revenue-sharing opportunities with content creators. This change has disrupted the traditional model of social media.
Unlike YouTube, TikTok is not profitable. It is no surprise they show fewer ads when they are generating no profits. There is no "breaking the revenue model of incumbents" when you are not profitable. Perhaps when they try to be profitable, they will be more like... YouTube.
Is it a better deal than YouTube? Last I heard TikTok has a pool of money they distribute in some magic way that's not directly tied to either company revenue or a video's view/like counts.
That's great if you already have an audience but I think TikTok model might be better to keep the wheels turning in the long term as it encourages users to try their luck on content creation as the chances of something hitting viral level there is bigger.
The model of feeds adopted by YouTube and Instagram has a lot of first mover advantages which makes succeeding as a newcomer really hard. It's really hard to find successful creators in the past few years that hit success without recurring to paid promotion or sponsorship from other more successful creators.
Which is precisely why they’re now conspiring to get it banned under dubious ”national security” pretenses. As if the data-sharing sins in question hadn’t been committed repeatedly by almost every major tech company for the past decade+.
I would to love to hear first hand from a TikTok creator in this thread because everything I've seen and heard is that their revenue-sharing is a complete joke and afterthought.
Hank Green, a fairly prominent Youtuber and increasingly successful Tiktoker did a video a while back, and AFAIK the situation with the TikTok creator fund hasn't changed significantly since. You basically TLDR'd it: their revenue-sharing is far worse than main Youtube videos, and even quite worse than Youtube's model for Shorts.
Readit News
A lot of the perceived gap between short-form video and other social media's profitability can likely just be explained by TikTok's relatively nascent ad platform -- you could substitute TikTok with Twitter and make the case that it's text-based social apps that are worse ad businesses. My guess is it's more about the ad infrastructure itself than the experience you're bolting it on to.
But it's also interesting to think that TikTok made a product that's too good at retaining users' attention, such that they can't be tantalized by an ad to interrupt their addiction.
Also known as stage one of the enshittification process:
> first, [platforms] are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves.
https://pluralistic.net/2023/01/21/potemkin-ai/#hey-guys
Is this actually true, though?
Aside from reels on IG, I’m struggling to think of anything that Meta has successfully launched to broad consumer adoption in the last few years.
And I know you specified launches in the last couple years, but just doing some back of the envelope math, some 60 percent of the world population where Meta isn't banned are MAUs across their family of apps -- hard to argue against their broad consumer adoption generally.
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Refining engagement maximization, to maximize ad slots, with a little consideration of user satisfaction.
I think it will take a few years for the data to come through and for ad agencies to fully wise up, but I'm convinced that short-form video is THE fertile ground for advertisers at the moment. There's an entire generation of consumers who never watch broadcast TV, never buy magazines, and don't spend much time browsing the regular web. Short form video ads are in many way the ONLY way to reach them, and based off the amount of stuff I see my teenage cousins order, I think it's working as designed.
Twitter was and is still very, very popularly used to get immediate news in the event of domestic and international emergencies and it still is at this point considering it is used as a platform which agencies can use to convey information quickly and have it retweeted.
Anyone who has been on Twitter recognizes this. You can still find first-person POV from users in some really interesting situations that would otherwise not be shown on mass-media networks due to regulatory controls on what can and can't be shown.
Does that validate the use-case in Twitter being banned? Let's say the new owner doesn't want to show reporting from what is happening in Eastern Europe - does that further solidify an argument that it should be banned because it has been 'weaponized'?
The author at no point references Twitter in their article and just continues on a narrow lens on the subject matter.
What is the value in banning an app in a shroud of hypotheticals?
It didn't make a lot of sense. It was a weak argument. Until I got to this part:
In other words, even if the TikTok issue seems largely symbolic right now, the app’s dominance of American media gives China’s government a considerable amount of option value in the event of a crisis. TikTok could become really important, really fast.
In other words, it could be bad at some future time. But the US is overwhelmingly supportive of Ukraine (and there is a lot of pro-Ukraine content on TikTok) and Taiwan. Americans broadly understand these are democracies under threat and deserve support. TikTok is not in a position to change those perceptions.
> Toward the end of the 45–minute experiment, analysts’ feeds were almost exclusively populated with both accurate and false content related to the war in Ukraine
A DoD funded company says that new accounts on TikTok were exposed to correct and incorrect information the Ukraine war. This is going to be true on any social media app in the entire world.
> For years, lawmakers and commentators have feared that the Chinese government could use TikTok — which is owned by a Chinese parent company, ByteDance — to secretly distribute content sympathetic to the Chinese Communist Party in order to shift public opinion in the United States.
Former employees of a separate app that shut down 3 years ago claim they were told to pin videos of pandas and tourism in China to the front page.
> TikTok can collect, which includes faceprints, voiceprints, browsing history, text messages, and pretty much anything you do on your phone
Again, not unique.
Do I like TikTok? No. But I don't think hypotheticals are enough reason to ban it. I think this is a very similar scenario to the 2016 Russian misinformation hysteria that was ultimately mostly unfounded.
Because they can’t control it like they can control Google, Microsoft etc. inserting whatever back doors they want. Video outlines it well.
What we should be banning is behavior, not authorship. Does the application retrieve user data? What data? Is that retrieval bad and user hostile? Ban that behavior. Does the application do something else bad? Ban that behavior. Banning something simply because it's controlled by a government we don't like is a bad precedent. We should do the work to describe what specifically the application is doing that we don't like and address that, because it would also have the effect of applying consumer-friendly laws to all the others apps doing that as well with the goal of making ad revenue and not just collecting information for a hostile government.
And probably many, if not most traditional media outlets too.
Maybe a few hundred other ad and personal information sales supported applications.
There are very few good actors on the internet today, when you evaluate them based on the behaviors you mention.
2. Many products are banned in china (google, twitter, facebook, whatsapp, github... etc). And CCP bans at will. Maybe a bit of retaliation is justified?
They aren't banned "at will" they were banned for violating Chinese law by refusing to remove illegal content. You can disagree with those laws, but calling it "at will" is disingenuous.
A country should only allow foreign businesses in from countries that would allow that same business in from our country.
Pretending the CCP subsidized enterprise is a free market is just wrong.
Chinese spying on US isn't mitigated by US getting a chance to spy on Chinese.
The concern is that the market deals in materials too dangerous to be allowed to be run by foreign adversaries.
China has state capitalism, and "communist" is name only, and not relevant to the topic.
I imagine they are still very eager to shift into that type of model since the format does present some real potential in generating conversions. If you've done the ads where the user can 'swipe' into the e-commerce shop those seem to work really well for makeup brands from what I've seen.
Sources, if anyone is interested in checking out what I mean
[1] https://archive.ph/YWt6N
[2] https://www.theguardian.com/technology/2022/oct/12/job-listi...
[3] https://www.axios.com/2022/10/11/tiktok-chases-amazon-fulfil...
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Unlike YouTube, TikTok is not profitable. It is no surprise they show fewer ads when they are generating no profits. There is no "breaking the revenue model of incumbents" when you are not profitable. Perhaps when they try to be profitable, they will be more like... YouTube.
The model of feeds adopted by YouTube and Instagram has a lot of first mover advantages which makes succeeding as a newcomer really hard. It's really hard to find successful creators in the past few years that hit success without recurring to paid promotion or sponsorship from other more successful creators.
In return they give up access to user data, allow deplatforming and shadowbanning whoever they are asked to by people in the government.
"American Free Speech" is ensured.
https://www.youtube.com/watch?v=jAZapFzpP64&t
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