Don't Monetize Your Friends

Imagine getting paid to socialize. At first, sounds great. Sort of like politics. You earn money meeting people, having drinks with friends, calling to wish happy birthday. But slowly, your behavior changes. You start socializing in the most financially rewarding ways. You call people excessively and leave long-winded voice messages when they ignore you. Suddenly, you can’t have real relationships. You commodify your friendships. And when your friends get offended, you blow them off and look for more financially rewarding relationships.

Then your boss sweetens the pot. Rather than just pay for your social activity, she starts paying for the social activity of people you refer to the company. So you’re even less interested in real relationships. You focus on referring people—friends or not, who cares—then kick back while they monetize their friendships. Suddenly, it’s not about friendship at all. Your social life becomes a line item in a spreadsheet.

It might sound far-fetched. But if a new social networking site called Yuwie succeeds, that’s exactly how the future of online friendship might look. Started in May 2007, Yuwie is similar to MySpace and Facebook, with one big difference: it pays users for generated activity—views of their profile and photos, for example—and that of people they refer. Sort of like a pyramid scheme. And it threatens the foundation of social networking: the whole “social” part.

A recipe for spam

Getting accurate information about Yuwie from users is a challenge. Most reviewers have a vested interest in its survival—and in referring you to sign up. So even a site called Yuwie Scam includes a banner with a link containing the site owner’s referral code.

What most report, however, is needing to refer lots of “friends” to make money. Yuwie pays users a portion of advertising revenue, and as anyone with a web magazine or blog knows, online advertising revenue isn’t the ticket to financial freedom. In fact, Yuwie notes that if you refer 19,683 friends, who in turn generate about 19.7 million impressions, you’ll still make just about $984 a month.

Seems like lots of virtual birthday cards for little money.

Or maybe just lots of spam. Because that’s the other, obvious impact of paying for impressions. First, people will embed their referral links in spam around the web, trying to entice others to register and bring them ever closer to the 20,000 friends they need to pay the rent. Second, people will post spam to Yuwie itself, trying to increase their impression count to jack their earnings.

Don’t add me

Now, I’m not against affiliate marketing or paying for user-generated content. The former rewards people for promoting products with less risk to marketers and, in best-case scenarios, helps users by aligning ads with relevant content. The latter encourages online efforts; people who place Google AdSense ads on their blogs, for example, can benefit from visits, encouraging them to post better content and increase their readership.

Yuwie, however, doesn’t appear to be a viable long-term model. First, it turns something people don’t want to monetize—their friendships and social life—into a commodity. Second, it rewards people for referrals regardless of their relationship. Third, it threatens to create more useless impressions for advertisers, at a time when many advertisers already doubt the value of advertising on social networking sites and sites with user-generated content.

Of course, none of this has stopped Yuwie from growing faster than an online hoax. The promise of free money has that effect. And so Alexa reports that the reach for Yuwie has grown 92,900% in the past three months, making it the 5,547th most visited website on the internet.

But are users of social networking websites, advertisers, those seeking financial independence, or your friends any better off? Unlikely. And if you think I’m wrong, please create a Yuwie account and refer 20,000 friends to prove it.

Comments

[miro]

Simon

in a web 2.0 world - this will hopefully whither and die as people come to recognize its function/value.

the only problem is that the database generated in the interim will remain intact and probably be resold several times.

Miro

[Rick]

This article immediately sparked memories of past friends getting sucked into MLM schemes - and then hitting up all their friends to join or buy their products. Given the long success of some MLM schemes - it might actually take off online too (sadly).