MySpace Wins An Uncollectable $234 Million Award In Spam Case

from the sending-a-message? dept

Last month, we wrote about how MySpace had won its case against Sanford "Spamford" Wallace -- the infamous 1990s "Spam King" who (despite losing many court battles and owing millions in fines) simply can't seem to give up his obsession with scammy marketing techniques. The win was a default judgment, mainly because Wallace simply disappeared and stopped responding to court requests. Today, a judge ruled on the punishment, officially awarding MySpace $234 million from Wallace and his associate Walter Rines. Given Wallace's disappearing act (which he's done in the past as well) it's unlikely that MySpace will ever see a dime of the money, but that hasn't stopped the company from touting this as the largest ever award under CAN SPAM. Amusingly, the extremely short court ruling also bars Wallace from setting up any new MySpace profiles. It doesn't say anything about Facebook, though, so perhaps that's where we'll see him next...

Filed Under: can spam, fines, sanford wallace, social networks, spam, spamford, walter rines
Companies: myspace

Social Networking Sites Turn Outward

from the privacy-challenges dept

The New York Times reports on MySpace's new Data Availability project, which will allow third-party websites to automatically import information from a user's profile, saving the user the hassle of re-entering it on a bunch of different sites. As the Bits blog says, this is a smart move and could be the start of an important trend toward making MySpace a more outward-focused platform. Facebook wasted no time in announcing a program of its own called Facebook Connect that will have similar functionality. And now it looks like Google will rolling out an extension for Open Social that will provide some of the same features. We've said before that the achilles heel of social networking sites is that they're so inwardly-focused. In the long run, it's going to be difficult for any site—even one as large and technically savvy as Facebook or MySpace, to get users to stay inside of a walled garden. The site that figures out how to be a platform that other sites use for identity management will have a huge advantage in the long run. MySpace and Facebook appear to regard this kind of outwardly-focused platform as the next frontier in social networking.

They're going to face some serious challenges in the privacy department, though. We discussed the privacy dilemma with Facebook apps back in January, and both Facebook and MySpace are going to have to grapple with the same set of issues with their new strategies. On the one hand, they need to lock things down sufficiently that one bad (or compromised) application can't suck down a ton of private user data and do bad things with it. On the other hand, if they are too restrictive, it will limit the usefulness of their platforms and discourage third-party websites from using them at all. Striking this balance, and coming up with security mechanisms that give sites the information they need without giving away the store, will be crucial to these initiatives' success.

I think it's possible that these problems will prove intractable. Ordinarily, when we talk about an "open API," we mean an API that anybody can use without any kind of pre-approval, and that doesn't constrain how data received through the API is used. Obviously, MySpace and Facebook aren't going to want to offer an API that's open in this sense; there's too much potential for mischief if an application can trick a user into authorizing a malicious application. So unless they can come up with a really elegant mechanism for limiting the spread of information, there's going to have to be a vetting process, which will mean extra overhead that limits how quickly the platform can grow. It's going to take a lot of ingenuity to make these platforms open enough that a lot of potential partners can participate while keeping them closed enough that they don't become vehicles for the bad guys to cause problems.

Filed Under: apis, data portability, openness, social networks

Congressman Freaks Out About Second Life; Demands Ban In Schools

from the fear!-save-the-children!-be-afraid! dept

Just a few months after worrying about terrorists hiding in Second Life, now at least one Congressional representative is worried about how Second Life is corrupting your children. He's trying to drum up support to ban Second Life from schools and libraries, hyping up the fact that "bad stuff" happens in Second Life and, gosh, we wouldn't want kids to learn how to deal with bad stuff in an environment where they're protected from any physical harm. It'll be much better when they learn to deal with it out on the streets.

This is actually an attempt by Rep. Mark Kirk to reintroduce DOPA, the Deleting Online Predators Act. It was last introduced almost exactly two years ago (note the timing: right before Congressional election season...). Because very few politicians want to give an opening to challengers to their seats to put out an ad saying they voted against "protecting the children" last time around the law was quickly approved by the House by a massive 410 to 15 vote, at which point it moved on to the Senate to die (not having all Senators up for re-election at the same time has its benefits). Of the 15 dissenters to the original bill, Rep. John Dingell was the one who said what needed to be said (and which so few other Reps were willing to say):

"So now we are on the floor with a piece of legislation poorly thought out, with an abundance of surprises, which carries with it that curious smell of partisanship and panic, but which is not going to address the problems. This is a piece of legislation which is going to be notorious for its ineffectiveness and, of course, for its political benefits to some of the members hereabout."

Yes, the law would effectively ban a ton of internet sites from schools and libraries, including ones like LinkedIn, Slashdot and Amazon.com, based on its overly broad language. On top of all that, study after study after study has shown that social networks and virtual worlds (despite the FUD) are not "breeding grounds" for predators. And, of course, parents are finally coming to terms with this and are no longer freaking out about kids using these sites. So, explain why we need such unnecessary and overly broad legislation again? Oh right, it's election season...

Filed Under: congress, dopa, mark kirk, protect the children, schools, second life, social networks

Facebook Can Be Fun, But It's Also Useful

from the social-density dept

Mathew Ingram argues that Facebook is about fun, and that it's not that hard to turn a profit on a platform that's oriented around fun and games. He's certainly right that fun and business aren't incompatible, but I think it's a mistake to discount how useful it can be. In my experience the most useful features are not the add-on applications but the basic features built into Facebook itself. These features aren't as glamorous, but I think they're enough to ensure Facebook won't prove to be a fad like Friendster did

First there's Facebook's groups feature. Twenty years ago, people who wanted to organize to achieve a common goal -- whether it was supporting a political candidate, protesting a company's bad customer service, or finding other fans of a favorite TV show -- frequently didn't have a cost-effective way to do it. The phone and email were just too cumbersome and expensive. Even ten years ago, group formation required setting up a website or creating a mailing list, something that still required a non-trivial amount of work and often had limited functionality. In contrast, groups on Facebook are incredibly easy to create and maintain and they have a ton of useful features. The modest improvements in ease of use aren't amazing from a technical perspective, but they've made a big difference in peoples' ability to quickly form groups and find people with shared interests or goals.

Second, the photos feature on Facebook is incredibly useful. Of course, sites like Flickr have done photo sharing for years. But having its photo application embedded in a broader social network gives Facebook key advantages that its competitors can't match. If my friends have Flickr accounts, I don't know about it, but I can easily see which of my friends have Facebook pictures. The pre-existing social network also allows Facebook users to mark themselves or their friends in photos, which causes them to show up in their friends' photo albums.

Finally, I've been noticing that Facebook is beginning to displace Evite as the preferred vehicle for party invitations among my friends. This is another case where having a pre-existing social network is a huge advantage. With Facebook, I can create my guest list simply by running through the list of friends and checking the ones I want to invite. With Evite, in contrast, I have to dig up the email addresses of all the people I want to invite. And many people are already visiting Facebook regularly, so it's less annoying to RSVP there than on a site that only does party invitations. Adding an invitation feature to a site people already use creates a lot less friction than asking them to sign up for a totally separate invitations site.

All of which illustrates a point Clay Shirky has made: really interesting social changes are the result not of new technology, per se, but of social density: a networking site that 90 percent of your friends use is vastly more useful than a site that 10 percent of your friends use. Very little of Facebook's functionality is new from a technical perspective, but Facebook (and MySpace) are the first sites to reach a point where almost everyone in certain social groups use them. And that fact dramatically increases their value. I don't know if Facebook is worth $15 billion, but it's certainly not a flash in the pan, and its appeal isn't limited to Scrabulous.

Filed Under: social networks, utility
Companies: facebook

If You're Part Of An Elite Military Unit, Perhaps You Shouldn't Be Uploading Photos Of Your Base To Facebook

from the just-a-suggestion dept

People who have grown up with social networking type sites and applications have become used to the idea of really documenting their lives with them: providing detailed updates and regularly uploading photos of their activities. That's great for most folks -- but if you're in an elite military unit in a war zone, that might present a problem. An Israeli soldier has been sentenced to 19 days in jail after the military noticed that he'd been posting photos of the base where he was stationed to Facebook where anyone could see them. You would think that it would be common sense not to do such a thing... but common sense sometimes isn't so common.

Filed Under: israel, military, photos, secrets, social networks
Companies: facebook

Fewer And Fewer Parents Freaking Out About Kids Chatting Online

from the good-things dept

If you look at the history of pop culture, there's a pretty clear pattern that emerges: parents fear whatever "new" thing their kids are into, whether it's "rock n roll" or video games or social networking. The fear boils up, even to the point of politicians pushing for laws to stop this horrible thing. But then, after a little while, parents realize the "new thing" they feared really isn't so bad. So while we're still seeing fear mongering reports about social networking, it appears that parents are increasingly comfortable with their kids chatting online using social networks or chat applications. That's good, too, because studies have shown these things really are not particularly dangerous, and most kids are perfectly able to handle whatever minor dangers they might face. Have no fear, though, I'm sure parents will soon find some other new terrible thing that needs to be regulated... and politicians will happily oblige. And, in the meantime, since politicians are a bit slow on these things, don't expect the laws against social networks to die down just yet either. There's still plenty of grandstanding to be squeezed out of that lemon.

Filed Under: kids, parents, social networks

Sending Love Notes Via MySpace Not Considered Harassment

from the not-that-it-should-give-you-any-ideas dept

Teenagers fall in love quite easily... and when they do, they often do silly things like repeatedly telling the object of their affection how they feel, even if that love is unrequited. These days, with teens living on social networks like MySpace and Facebook, it should come as no surprise that many are using such social networks to express that love. Apparently, one young woman felt that an infatuated teen's MySpace repeated messages constituted harassment. However, in a rather eloquent decision, a NY court has disagreed, pointing out the awkward and obsessive nature of teenaged love, combined with the more practical fact that MySpace users can block messages (which this girl never did) and that she never bothered to tell the guy to stop sending such messages. Combine this with the recent ruling that sending a Facebook friend request to an ex- is not harassment, and you start to realize that the courts are going to be quite busy over the next few years trying to port offline laws into the online world of social networks.

Filed Under: harassment, social networks
Companies: myspace

Facebook/ConnectU Settlement Shows Why Losers Litigate

from the it's-profitable dept

Last year, in the midst of various claims from multiple different people that Mark Zuckerberg somehow "stole" the idea for Facebook from other Harvard students, we noted that it really didn't matter. After all, the basic concepts behind Facebook were hardly new when Zuckerberg started it. There had been sites like SixDegrees, Ryze and Friendster long before Facebook came along. What mattered wasn't the idea, but the execution -- and for whatever reason, what Zuckerberg did with Facebook got traction while the others did not. That's called competition, and we generally think that leads to a healthy economy. Yet, the founders of ConnectU, the competing site that went nowhere, sued Zuckerberg and Facebook over this, and both sides were pushed by a judge to settle out of court -- and that appears to be exactly what's happening. The NY Times is reporting that Facebook has reached some sort of settlement with ConnectU's founders.

This sort of thing was inevitable, but it's still problematic. With Facebook generating so much publicity lately, and potentially gearing up for an IPO, it doesn't want these types of lawsuits hanging over it. So it's worth more to just settle and pay up, even if the claim itself is bogus. Yet, all this really does is encourage more similar lawsuits from companies that lost in the marketplace whining about competitors who did a better job executing. While some may say the ConnectU case is different because Zuckerberg worked with ConnectU for a few months, that hardly changes the basic facts of the case. This wasn't a new idea, and it's unlikely that ConnectU had done anything remarkably different than other competitors out there. In fact, it seems clear that it did not, since the site never went anywhere. Yet, because it's cheaper for Facebook to pay out and keep this quiet, ConnectU's founders get paid for failing in the marketplace. That's a bad precedent no matter how you look at it.

Filed Under: copying, litigation, mark zuckerberg, social networks
Companies: connectu, facebook

Major Record Labels Form Joint Venture With MySpace

from the to-do-what-exactly? dept

There's been some buzz about this all week, but now it's official that MySpace has teamed up with three of the four major record labels (the smallest, EMI, is still holding out, though it may join eventually) to create a joint venture offering called MySpace Music. The company is separate, but connected to MySpace. Unfortunately, the details are incredibly vague. So far, it seems to say that the new company will "let people listen to tunes and watch videos for free on the Web, as well as buy merchandise, concert tickets, and music through downloads." That's a pretty broad description, and while it sounds good upfront, execution is everything. And, historically, the major labels haven't executed particularly well when it comes to creating online music offerings. Already, it seems like they're hedging by saying that they're not committed to offering DRM-free music from this service. In fact, it often seems like these efforts are designed to fail. So, let's take this as a tentative step in the right direction, though with the expectation that the labels will likely do something to screw this up along the way. At the very least, it's the labels recognizing they need to change -- even if they still haven't come to terms with how to actually change.

Filed Under: business models, music, record labels, social networks
Companies: myspace, sony bmg, universal music, warner music

It's Not Exploitation If You Chose To Take Part

from the repeat-after-me dept

Well, the buzz of the weekend seems to be around a New York Times op-ed by musician Billy Bragg upset about the sale of Bebo to AOL earlier this month. Bragg's complaint is an old one that we've heard before: Because musicians chose to put their music on Bebo and that helped attract users, don't they deserve some of the $850 million that Bebo got from AOL. Not surprisingly, Nick Carr, who has been pushing this obviously false notion that "user-generated content" is exploitation, comes to Bragg's defense with his usual technique: sound smart, make some interesting points, and then wrap it up with a conclusion that is in absolutely no way supported by the facts.

Let's break this down. The first complaint is that somehow Bebo was "using" this music for "free." This is false. There was a fair trade in an open marketplace that made this happen. Bebo offered musicians a chance to promote themselves (for free) to its community. Musicians accepted this offer, and in exchange, provided their music for free. No one was forced into it. No one was compelled to do it. If either party felt the other was unfair they could choose not to engage in the trade -- and they could also vocally complain. In fact, Bragg did just that when he felt MySpace's terms were unfair, and they changed them. So by choosing to accept Bebo's terms, clearly they were perfectly acceptable. It was a fair trade.

Bragg goes on to assert: "The musicians who posted their work on Bebo.com are no different from investors in a start-up enterprise. Their investment is the content provided for free while the site has no liquid assets. Now that the business has reaped huge benefits, surely they deserve a dividend." Actually, they're very different from investors. Investors made a very different trade. They traded money for equity. Again, it was the fair and open market that allowed that. If Bragg had wanted to trade music for equity, he should have discussed it before... not after. You can be sure that any investors in Bebo didn't ask to change the terms of the deal after the buyout went through.

Complaining after the fact about what happened is like selling a bunch of wood to a builder for a few thousand dollars, and then complaining when he turns that into a million dollar house. Was the wood seller exploited? No. He made the fair trade, and the builder was then free to do what he wanted.

Nick Carr's response to all of this is especially wrong. He writes: "When challenged in this way, the plantation owners counter that they are doing musicians a favor by providing them with a place to promote their work." That is incorrect in so many ways it would take another whole post to get through them all. But let's take the simple point: no one is saying they are doing musicians "a favor." They are saying that there's a fair trade. You give music, we give promotion. No favors at all.

Carr and Bragg go on to use radio as an example, noting that it pays royalties, so why shouldn't social networking sites. This is incorrect for a variety of reasons. First, in the US at least, radios do not pay musicians royalties. This was a decision made by the government that since musicians benefit from airplay, no royalties are needed for the musicians (other royalties are paid for composers and publishers). However, much more to the point was that for most of the history of popular music, those royalties have been meaningless -- as record labels went through all sorts of contortions to have the money go in the other direction. What's sometimes called "payola" has gone on for years, with the record labels effectively bribing radio stations to get music on the air -- recognizing that the promotional value greatly outweighed the royalties coming in.

In other words, a free market will let the benefits to both sides balance out. If payment needs to even up one side, then the market will determine that. But, many musicians made a fair trade decision to take up the offer that Bebo made. It's their own fault if they feel they got the short end of the stick, but they clearly were happy to go along with the deal originally. Buyer's remorse and sour grapes are no excuse. If anything, this sounds quite similar to Doug Morris' ridiculous belief that no one else can make money.

To understand this most simply, it goes back to the psychological explanation we discussed earlier this year, where relevancies matter. People dislike seeing someone else made much better off, even if they are better off themselves. These musicians felt they were better off by using Bebo, but they're now upset that Bebo's founders are relatively better off than they are at the end of the deal. It's a weird world when someone would prefer to be worse off, rather than seeing someone else be even better off. In the meantime, if you'd like to read an ongoing debate between Billy Bragg, myself, Tim Lee and Joe Weisenthal, check out the post on Joe's blog where we all discuss this in the comments.

Filed Under: billy bragg, copyright, music, nicholas carr, royalties, social networks
Companies: bebo