Selling Social Media

The Political Economy of Social Networking

Daniel Faltesek

• Publisher: Bloomsbury Academic
• Year: 2018
• Print ISBN: 9781501319693
• eBook ISBN: 9781501319709
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Ética empresarial

Facebook, Twitter, Snapchat, YouTube, LinkedIn, and dozens of other services have been described as the vanguard of creative destruction across the media industries-disruptors of established business, heroes of a new economic narrative that supposes that the attention of individual users can be measured, managed, manipulated, backing methods that securitized, patented, and litigated attention in ways impossible before. Selling Social Media catalogues the key terms and discourses of the rise of social media firms with a particular emphasis on monetization, securitization, disruption, and litigation. Tensions between ideas and terms are critical, as the ways that different aspects of social media business are described change depending on the audience, scale, and maturity of the firm. These divergent discourses are bound together into a single story of social media, an industry that challenges the theories and descriptions of media that have come before. Through a reading of social media business this book offers a chance to revisit media theory in the context of a new social media companies and products that depend on a different understanding of media audiences, media industries, and public agency.

1

Monetization or: The Romance of the Click

By developing a fundamentally new way for people to create, distribute and discover content, we have democratized content creation and distribution, enabling any voice to echo around the world instantly and unfiltered.

Twitter S-1, October 2013¹

Among the ruins of the dot-com bubble were the dreams of banner advertisements paving the path toward a new life. A few inches at the top of the page were supposed to be incredibly valuable. The idea of a simple technology providing an income for millions of people is appealing; build it and they will come. Space on websites could be more tightly targeted, more interactive, and more direct than any advertisement that came before. New advertising products would seem to be much more valuable than their analog predecessors. Viewers can’t click a bus ad—it drives away, leaving a cloud of smoke. Internet advertisements don’t smell and won’t make you cough. Any sliver of space where an advertisement could appear was presented as an opportunity for monetization. This is no mere buzzword—“monetize” appears in legal documents, popular press articles, technical descriptions, and everyday life. Monetization has become the stand-in for a host of business processes, including advertising sales, lead generation, inventory management, and customer service, among many others. It is unclear exactly what monetization is and what it isn’t; we know that it is the thing that generates wealth. Wealth is good. Visions of infinite wealth inflate bubbles.

Money is the root word of monetization. Writing the history of money is not a topic for a book chapter; several volumes would be inadequate. The review of the history of money and monetization literature in this chapter reveals an important emptiness. Instead of a smooth, linear trajectory from barter to the electronic market, the actual assemblage of facts seems to unfold in a contradictory and herky-jerky way. Unlike the smooth stories of monetary development repeated so easily in economic literature, the story is very complicated. Monetization is often defined as either the rapid expansion of the production of official money or the expansion of money to ever-expanding realms of social life: these don’t improve clarity in understanding the use of the term in the world of social media. Money is tricky, it means but it doesn’t mean, it has the weight of soldier’s steel, but is as light as linen.

From this poor anchor point, the chapter will unfold the meanings of monetization in the political economy of social media. Monetization appears as arbitrage, extraction, and alchemy. Metaphor makes the actual business distant, yet intelligible. Just as an affiliate link makes the idea of a referral less banal, the extraction of key of “influencers” makes the idea of advertising less boring. The unstable, amorphous, and shifting sands of monetization are the grounding point of the bubble world. Once declared found, or at least deferred, a monetization strategy adds texture to the entire scene of the business. Beyond the idea of what a business might be, dreams of monetization carry the logic of the romantic individual self as a central theme. It is not simply that they claim to secure value from people, their attention, or their clicks, but they must also theorize who those people are, and what it means to be a person with attention. Monetization is the defining concept of this era.

This chapter covers quite a bit of territory. The ideas can be broken down into a few useful clusters:

• The story of monetization requires a discussion of money itself. More than a simple social construction or mere transaction moderator, money interacts in any number of curious ways with culture. Monetization introduces any number of slippages and surpluses that need to be accounted for in understanding social media.

• Monetization Metaphors. Each of the three primary metaphors for monetization—arbitrage, extraction, and alchemy—be presented at length with allied examples of how they are literalized in the media industries. The meaning of money itself shifts depending on the metaphor.

• Monetization schemes will be situated in the dominant language of the social media companies for selling advertisements, specifically in the idea of the social graph (Facebook) and the interest graph (Twitter) and what these different models of monetization, market segmentation analysis, advertising, and public relations say about the larger structure of the media industries.

• Pinterest will be considered as an outlier, as the network should be considered a prime property as per social media industry discourses, but is often ignored or even maligned.

A brief history of monetization

Money is tricky. In one sense it is incredibly simple; money is a transaction moderator that is more efficient than barter. This story is not untrue. Money is durable, easy to transport, and, if emblazoned with the markings of a strong state, authoritative. Money is more than an effective transaction moderator; it is a thing that is valuable in and of itself. Scrooge McDuck, Disney’s extension of the Donald Duck archetype for the Regan generation, loved to swim in gold. Scrooge’s pool of bullion, his money bin, is a central narrative device in many episodes as access to it is the highest priority. A giant box full of gold is the most valuable thing in the world, aside from his nephews and their friend Webby. Money is magical; it is a metal that flows.

A surprising number of theories are willing to take barter story for granted as the basis of the authority of money. The barter story is persuasive for a number of theorists in politics, economics, sociology, and communication as it seems to provide an elegant description of a social process with a very small number of assumptions. If the role of money in society is simple in the context of the theory presented, the barter theory might be enough; if money plays any larger role a more complete accounting is called for. There are a few considerations in the history and theory of money that weigh heavily in this book. First, the historical trajectory from barter to Bitcoin is by no means linear or clear. Second, on a personal level, conceptions of money exceed the boundaries of mere transaction moderation. People love money; they hoard it. Third, theories that depend on the barter theory of money provide it with power beyond the mere extension of barter: the ostensible evil of money is taken as a powerful starting point in many social theories. Money is described as being more than a mere transaction moderator on the structural level; it is an agent of either salvation or destruction.

The use of money and money-like instruments has waxed and waned over the course of history, with money taking different forms, and transforming different societies along the way.² David Schaps argues that the earliest society to use coin money was Athenian Greece.³ Before this, payment standards existed, but came in the form of specified amounts of grain, metal, or other local materials.⁴ Accounts transacted in silver could be measured in barley, for example. Relationships between money types were difficult as the properties of different money like things were very different.⁵ This stands in contrast to historical theories that might deny that money transactions existed before coinage. Transaction forms other than pure barter preceded the existence of money proper. The technology of money does not have a single origin and was likely invented autonomously in at least three places.⁶ Kublai Kahn transitioned his empire of the thirteenth century to purely paper money.⁷ The earliest forms of paper money in the United States were tobacco-backed notes in the nineteenth century, with many states allowing wildcat banks to issue their own currencies.⁸ Theories of money that begin with the United States miss almost the entire history of currency.

A contemporary economy with money is an economy with serial numbers, standardization, and more easily transmitted pricing information—which is not to say that money drove the development of new market technologies. Electronic trading via telegraph came before the standardization of money.⁹ Instead of an even historical evolution of exchange relationships, the very thing that facilitates exchange is unstable and highly political. Without belaboring the point, it is fair to say that the story of barter quickly giving way to money is an occasionally useful counterfactual.

In his account of the history of money and desire, What Money Wants, Noam Yuran argues that the history of money is a counterfactual shibboleth—tales of the rise of money are necessarily false, and their expression ties the teller to a community.¹⁰ Telling the story of the rise of money sets the parameters for a theory of the economy. Money is worthy of consideration in its own right, specifically the ways in which the desire for money shapes the ostensibly rational world of economics. Values and aesthetics are focused by money like a lens. Yuran’s central contention is that money is not a historical communication technology, but as desire itself. What does this mean for this analysis? The desire for money is detached from what it actually is. Monetization is the prospect of making more, more reality, more power.

Yuran positions John Searle’s theory of money as social agreement as an alternative to this view.¹¹ Much like the barter story, the social agreement story supposes that people came to accept one day that money was valuable. If money were to simply be a unit of exchange that exists as much as it socially agreed upon, more money would be produced, allocations of wealth would be overthrown, and the underlying agreement changed. Searle’s account of money as agreement would need to account for the processes by which the agreement is made and maintained; it is not enough to posit an explanation of how money works; a theory would need to account for the ways that money appears legitimate.¹² After establishing that money is an agreement the turn to the quick historical narrative covers the rest of the history.¹³ Money is more than a mere effect of other desires: it is co-productive with desire. Fetishistic attachments to money would make little sense as it would merely be one of many possible transaction mediators.¹⁴ In overcoming many possible challenges, both practical and intersubjective, money proves that it has value as much as it can disavow challenges to its own authority. Yuran’s approach requires that theories of money that are affectively sophisticated be woven into theories of economic systems. There is no magical solution in this conception of the market, but a new insistence on affect from the lowest level up. After all, to say that all the social functions and positions of power related to money are tied to mere agreement loses the monotheism of money—there is no money but money, except all the other money.

Consider a common accusation in right Libertarian political discourse of the United States: the Left will debase the nation’s money. The accusation is a response to plans to build social programs or infrastructures through government spending. It supposes that in order to finance programs, additional currency would need to be created and this currency would not be backed by gold. There are many problems with this argument. Few currencies have been backed by convertible gold. Some inflation can be healthy, while deflation is associated with depressions. Gold convertibility is an idea from the late nineteenth century. The period of time when private persons in the United States could demand payment in gold, keep bullion, with no alternative money, was very short. Events during this apparently auspicious era include numerous panics, recessions, and depressions. Yet for some, the end of the gold standard was a capital crime. It removed the stable referent from the value that made the world coherent. There are many factual problems with the debasement narrative, which may be an important part of how it continues to be persuasive. Joining the movement of people invested in the story would confirm accession to that ideological matrix. Campaigns against debasement retroactively legitimate a currency that was never legitimate in their framework to begin with. These alternate histories posit the past as stable and harmonious, a key reactionary fantasy.¹⁵ Everything was awesome: objects had clear and transcendental meanings, until these people and their words got in the way. It should be no surprise that the economic histories offered by gold bugs have particular pathologies—since everything was better in the fantasy space of the gold economy; the real problems with a rapid boom-bust cycles are ignored.

Turning to the social scene of money, the presentation of money as a social force is complex. In The Social Meaning of Money, sociologist Viviana Zelizer emphasizes the point that most histories of money overplay stability. Zelizer argues that even important accounts like Simmel’s History of Money overstate the stability of currency.¹⁶ Simmel’s “colorlessness”, a nineteenth-century theory of the colonization of the lifeworld, demonstrates the problem with the assumption of a happy, stable money in the nineteenth century.¹⁷ It is new money that causes problems, not the old money. Things became too stable, too commoditized when exposed to money for Simmel, an argument common across critical theory. Zelizer’s approach is important as the social meaning of money is independent of the function of the currency—money is not a neutral transaction mediator and it never was. Zelizer defined monetization as the increasing use of money.¹⁸ Zelizer’s money was transformative, strategically reversible, and unstable. The use of money brings social change. Although money may flatten some relationships, the idea that money is always already corrupting is conceptually too simple to deal with the strategic reversal of power relationships that transactional arraignments might produce. It is not always a loss or flattening when uncompensated labor is remunerated. Values constantly shift around money, and if the analysis in this chapter is persuasive, money is often defined by the idea of things that it purchases or prices, just as they are redefined by it.

Zelizer’s history focuses on the late nineteenth century and the practice of earmarking, or delineating pools of money to be used for different purposes. Once in a pool, money would be appropriate only for certain tasks. Money from gambling would be dirty, while money from digging a ditch would be virtuous and clean. Expanding the use of money produced new social dynamics and possibilities; the story of rationalization or colorlessness, to use Simmel’s term, is not born out in the history of the nineteenth century.¹⁹ The attention to the actual affective dimension of the use of money that comes from Zelizer is something that this book aspires to and thus I try to avoid recourse to positions that assume the stability of money, the cross-cultural power of money, the preference for noncommercial values, or the automatic corruption that comes with monetization.²⁰ Just as these conceptual errors drive poor theory in orthodox economics and business, they also lead to faulty media studies research. This is not to say that there are not times when money can be corrupting, but to assume this as axiomatic in cultural critique is too simple and too quick a move for a deep and foundational problem. This is one of the most important melodramatic assumptions in media studies. Disciplines turn to fables when the stakes are high.

In other sociological work, money often appears in a relatively conventional vein. Monetization functions in this original context as a speech act, as money’s value is performatively produced.²¹ Anthony Giddens and Clifford Geertz both...

Table of contents

• Cover
• Halftitle Page
• Title Page
• Dedication Page
• Contents 
• List of Figures
• Acknowledgments
• Introduction
• 1. Monetization or: The Romance of the Click
• 2. Securitization or: Seeing Wall Street as a Server
• 3. Disruption or: Steel Mills, Disk Drives, and Hackathons
• 4. Litigation or: In Defense of Patent Trolls
• Conclusion: After Social Media Mania
• Notes
• Bibliography
• Index
• Imprint