When Facebook announced its recent $5 billion IPO, many applauded the company's mission to connect friends and make the world a more open place. Experts described Zuckerberg as "noble," "grandiose," and "downright inspirational." Twitter CEO Dick Costolo recently presented his vision in similar terms: "To instantly connect people everywhere." Indeed, the intuitive appeal of such social networking platforms is hard to overlook and partly explains their rapid growth. But alongside the dominance of these sites has come a disturbing new trend -- that social networks are altering the fabric of friendships, turning you into a business, and your friends and followers into customers of your content.
In the course of writing Passion and Purpose, I began to explore the link between social media and the changing nature of friendships. As many individuals I observed became obsessed with comparing themselves to others and curating their best selves, an alarming truth emerged: Just as a business sells goods and services in exchange for cash, people were producing content in exchange for their friends' and followers' attention. We've created the "social swap" -- a new form of transaction underpinning our online connections.
Here are some reasons why you're the business, and your friends are your customers:
First, your friends pay for your product.
Social network membership growth and platform updates are fueling hyper-sharing. In 2009, we produced 27 million tweets per day. In 2011, that number was 250 million. As more and more content is shared, our attention becomes the limiting factor in its consumption. Think twice before unleashing your content -- whether it is releasing a recently played list of Spotify songs on your unsuspecting Facebook friends or sending a picture of your gourmet lunch to your Twitter followers. In an information-overloaded world, you are asking your friends to pay the hefty price of their precious mind space.
Second, they evaluate your product and give you feedback.
Far from being an open social network where people's updates are shared freely, Facebook actually decides whether your content lives or dies. Or more accurately, your friends do. With recent updates to EdgeRank, Facebook's proprietary content-ranking algorithm, your post's visibility is a function of affinity (how close you are to your friend, as measured by past interaction), weight (how many comments and likes your post received), and time decay (how recently you posted). This algorithm catapults your friends from passive consumers of your content to powerful decision-makers. With each individual "like" and comment, they're evaluating whether your current and future updates are worthy of a wider audience. Just like an underperforming company, if you're producing product that people don't like, you'll be snuffed out and pushed to the bottom.
Finally, they refer others.
Our online friends and followers are now our personal customer lists, forming the basis of our publicly perceived popularity. Social media allows us to artificially collect friends and followers, so it's no surprise that we now think of our friends as what economists call a stock variable, numbers at a particular point in time. One tweeted: "Only two more followers until I hit 1,000!" and another posted (with a sense of impending doom) "I'm un-friending 200 people today." A close friend of mine regularly measures the attrition rate of his Facebook friends, and entirely new social networks have been formed to explicitly contain the number of connections an individual can make. These are rational actions; when social networks make friend and follower numbers public, your friends become vital social proof. And in the classic model, since friends attract more friends, every single one of your existing connections is an automatic personal referral engine and a path to greater popularity.
We should be wary of the social swap, no matter what side of the transaction we're on. As the business, you'll need to wisely curate content by aligning your posts and tweets with audience interest and by accurately timing your blasts. Anything less and your customers will leave in droves. As the customer of content, you're forced to decide who survives, voting on a limitless sea of product with your limited attention and engagement. Sadly, social media platforms are reducing our previously open and uncensored friendships to an unending series of calculated transactions.
Next time you see a friend, I suggest you politely thank them for their business.
This post was originally published on HBR.org.
Follow Daniel Gulati on Twitter: www.twitter.com/danielgulati