Ray Valdes

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Ray Valdes
Research VP
9 years at Gartner
30 years IT industry

Ray Valdes is research director in Gartner Research, where he is part of the Internet Platforms and Web Services team. Read Full Bio

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Facebook Adds Geo-Location to the Mainstream Social Experience

by Ray Valdes  |  August 19, 2010  |  2 Comments

Facebook announced its long-awaited geolocation capability earlier today: Facebook Places. I’m writing this while heading home after spending the earlier part of the day in Palo Alto at Facebook headquarters. Before the announcement, traveling to Palo Alto, I was thinking about what one might expect. My view is that adding location to the Facebook experience is a move that the company had to make, for two reasons:

1. The tactical reason is that Facebook has been facing a potential competitive threat from a new wave of location-based social networks. Ventures such as Foursquare, Gowalla and Booyah have been experiencing rapid growth and gaining visibility, despite being niche players in the broad field of social platforms. One should not overstate the threat — because this trend is based in part on a novelty factor, a reliance on game-like dynamics (badges and stamps), one likely to wear off over time. Nevertheless, one can still draw a parallel with the earlier rise of Twitter and FriendFeed as remote-but-plausible threats to Facebook.

2. The strategic reason is that this is how the Web is evolving, regardless of what a crop of small competitors may or may not be doing — the Web is becoming mobile, and social platforms like Facebook need to move forward accordingly. Mobile is already a big part of the Facebook experience. More than one-quarter of Facebook’s 500 million users (half of whom log on every single day) access Facebook through a mobile device. Geolocation is built into mobile devices and there are many scenarios where the adding a layer of location data can be beneficial to people and those with whom they interact. So regardless of potential upstart rivals, Facebook had to move in this strategic direction. Of course, there are obvious risks around the issue of user privacy as well. Given the past firestorm of criticism around privacy earlier this year, I was curious how aggressive Facebook would be regarding user sharing of location information. In the past, Facebook pushed users to the edge of their comfort zone (and a few over that line). Overall, I think they did a good job. (More discussion on this further below).

Another area I was thinking about before the announcement has to do with how Facebook would respond to the competitive challenge from Foursquare et al. There are two possible responses:

1. Copy features. This was the approach Facebook used in response to the challenge posed by Twitter. In March 2009, Facebook changed the user interface and added features to highlight real-time status updates– an activity stream similar to that on Twitter.

2. Acquire and merge. This was the tack Facebook took in responding to the challenge from FriendFeed, by acquiring the company in August 2009. For today’s announcement, an acquisition seemed like a low probability, inconsistent with the event format. Also, past rumors were that Facebook had already tried to acquire FourSquare for $100M+ and been turned down.

Of these two possibilities (copy features vs buy the rival), I expected the former. The emulate-features scenario can be further refined into two possibilities: adding a basic feature set versus doing a closer, more detailed copy. The high-fidelity copy would require Facebook to build in elaborate game dynamics to the user experience — this is what FourSquare has used to incentivize users to take the step of checking into a location. Given Facebook’s historical preference for a plain and straightforward approach to user interface design (compared to the roccocco extravaganza that was MySpace UI), I expected the company would unveil a basic no-frills experience.

The announcement came down in line with my expectations: Facebook added the feature in a mostly straightforward manner, and did not announce any acquisition. Even so, there were some surprises.

Facebook did not just announce a feature, but also a platform — by adding geolocation to the Facebook API. They avoided stepping into the controversy similar to what happened when Twitter moved to acquire and publish its own client software (for iPhone, desktop and Blackberry platforms) after a long history of letting other companies fill that need. Twitter was criticized for stomping on its ecosystem. By contrast, with today’s announcement, Facebook did not try to crush emerging challengers in the location sector, but instead brought them up on stage. Execs from Foursquare, Gowalla and Booyah succinctly extolled the virtues of the Facebook platform, and how this validates the market segment, and what a good opportunity the platform provides. Although these expressions of goodwill were made through strained faces, the situation was a lot better than the hypothetical alternative. The reality is that Facebook has not boxed in rivals but instead given them an escape hatch. If they are able to keep up the pace in innovation, they can perhaps stay ahead of the Facebook juggernaut — and survive long enough to get acquired by Google or Microsoft.

I had a chance to speak with CEO Mark Zuckerberg after the announcement, and he confirmed that Facebook had no plans to add game dynamics to the location experience.

Regarding user privacy, Facebook has done a better-than-expected effort in giving users control over disclosure of location data, but there is still room for improvement. A good thing is that, by default, location data is “friends only”. Although you are allowed to tag friends as being at a location (similar to tagging friends in a photo), you have to first check-into the location yourself, and user can opt out of being tagged entirely. (This is a feature that is not available in photos but would be most welcome there too). The way that users specify settings can be confusing. The ACLU has a good discussion of design flaws in the privacy controls (see http://bit.ly/aclu-on-fb-places ).

Beyond dials and controls, there are edge cases that need to be addressed: What if a place changes ownership? What if there is a restaurant that users check into, that later becomes a strip club, without changing its name? (Your history of checkins would become a social liability.) What if someone creates a place that is actually my house, can I delete it if I did not create it? Facebook staff did not have specific answers to these questions, other than to say that all of this would have to be worked out, via appeal.

Although the privacy controls could use improvement, but I think that the broader issue will evolve and mutate over time, along with people’s behaviors and expectations. Earlier today, traveling to Palo Alto from San Francisco on Route 280, I had Gowalla running on my phone and could see spots listed on the map (the exclusive Hillsborough neighborhood) that were individual’s houses — people I did not know, who either misconfigured their settings or perhaps have a strong predilection for social sharing. If Facebook were to do this, the howls would resonate across the scenic hills of Route 280.

One issue left on the table has to do with advertising and monetization. At the moment, Facebook is focusing on user adoption now, monetization later. Clearly there is an opportunity for using location data to more precisely target audiences with advertising. This is something that Facebook does not need to do right now, and would benefit from taking the time to do it right.

Let’s get to the bottom line: Is Facebook Places something that will be a wild success, or will it spark a firestorm of privacy complaints, or will it quietly fail to catch on? (As happened to Google Latitude). I think that crossing the chasm from the early adopter segment of oversharers, over to the more reticent mainstream, is not something that will happen right away. The mainstream will absorb geotagging habits only by osmosis over time. Privacy concerns will always be with us, but I don’t think they will derail Facebook’s strong trajectory in the evolving social platform sector. What do you think?

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2 responses so far ↓

  • 1 Privacy Concerns Raised Over Facebook Places | eWEEK Europe UK   August 19, 2010 at 8:02 am

    [...] to Gartner Analyst Ray Valdes, however, Facebook’s move into the location sector is not in any way an attempt to push out [...]

  • 2 clive boulton   August 19, 2010 at 2:54 pm

    Ray you nailed it.

    Privacy controls will get improvement…when the exclusive Hillsborough neighborhood howls (especially if some awful incident linked to location happens).

    Until then…