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The Future of Social Media Is Coming

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There are many possible futures that could be envisioned for social media, but I like Cal Newport’s take on it. He writes:

Just a few months ago, it seemed that the biggest social media news of the year would be Elon Musk’s flirtations with buying Twitter. Recently, however, a new story has sucked up an increasing amount of oxygen from this space: TikTok’s challenge to the legacy social platforms.

Last February, Meta, the parent company of Facebook and Instagram, released a quarterly report that revealed user growth had stalled. Analysts were quick to attribute this slow down, in part, to fierce competition from TikTok, which had recently blasted past the billion user mark. The valuation of Meta plummeted by over $200 billion in a single day.

Forced by investor pressure to respond, Meta began a sudden shift in its products’ features that moved them closer to the purified algorithmic distraction offered by its upstart rival. This spring, a leaked memo revealed Facebook’s plan to focus more on short videos and make recommendations “unconnected” to accounts that a user has already friended or followed. More recently, Instagram began experimenting with a TikTok-style full screen display, and has emphasized algorithmically-curated videos at the expense of photos shared by accounts the user follows.

From a short-term business perspective, these might seem like necessary changes. But as I argued in my most recent article for The New Yorker, published last week, the decision by companies like Facebook and Instagram to become more like TikTok could mark the beginning of their end.

The problem comes from their underlying business models. The social media giants of the last decade have cemented a pseudo-monopolistic position in the internet marketplace because they serve content based on massive social graphs, constructed in a distributed fashion by their users, one friend or follow request at a time. It’s too late now for a new service to build up a network of sufficient influence and complexity to compete with these legacy topologies.

TikTok, by contrast, doesn’t depend on this type of painstakingly accumulated social data. It instead deploys a simple but brutally effective machine learning loop onto the pool of all available videos on its platform. By observing the viewing behavior of individual users, this loop can quickly determine exactly which videos will most engage them; no friends, retweets, shares, or favorites required. The value of the TikTok experience is instead created by a unique dyadic mind meld between each user and the algorithm.

If platforms like Facebook and Instagram abandon their social graphs to pursue this cybernetic TikTok model, they’ll lose their competitive advantage. Subject, all at once, to the fierce competitive pressures of the mobile attention economy, it’s unclear whether they can survive without this protection.

As I argue in my article:

“This all points to a possible future in which social-media giants like Facebook may soon be past their long stretch of dominance. They’ll continue to chase new engagement models, leaving behind the protection of their social graphs, and in doing so eventually succumb to the new competitive pressures this introduces. TikTok, of course, is subject to these same pressures, so in this future it, too, will eventually fade. The app’s energetic embrace of shallowness makes it more likely, in the long term, to become the answer to a trivia question than a sustained cultural force. In the wake churned by these sinkings will arise new entertainments and new models for distraction, but also innovative new apps and methods for expression and interaction.”

In this prediction, I find optimism. If TikTok acts as the poison pill that finally cripples the digital dictators that for so long subjugated the web 2.0 revolution, we just might be left with more breathing room for smaller, more authentic, more human online engagements. “In the end, TikTok’s biggest legacy might be less about its current moment of world-conquering success, which will pass,” I conclude. “And more about how, by forcing social-media giants like Facebook to chase its model, it will end up liberating the social Internet.”

Action Line: Your Survival Guy doesn’t spend a lot of time on Facebook, but you can regularly find my posts on Mewe, Gab, and Gettr. If you’re more old-fashioned, click here to subscribe to my free monthly Survive & Thrive newsletter and it will show up the “old-fashioned way,” in your email box. And if you want to get ahold of me because you need help building an investment portfolio focused on dividends and income, click here. I’m looking forward to our conversation.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.
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