How Social Networks make money |
Social Networks include MySpace, Friendster and Facebook. By signing up in any of these, we are given the privilege to socialize, meet new friends, interact with other people’s interests, and even search for previous schoolmates and loved ones. This has also been a great way to become popular. Since many people are able to access our individual profiles, they can check out our special skills, talents and other stuffs that each one of us is interested with. Aside from these wonderful benefits, the coolest feature of these social networks would be its full accessibility and of without fees or charges.
You would ask, why are they offering these services completely for free? Actually, it’s because they are earning money out of it. It’s just that, they don’t give a damn trace why and how they earn cash from these social networks. Anyway, to give you a detailed idea about their means of money making, here’s how. 
Social Networks earn money out of the information they collect. Users register along with their Personal Identification Information or most popularly known as PII. This include your name, address or location, age, credit card numbers, gender, and other important personal information. At some point, these social networks also become interested with your skills, talents, interests, favorite movies, favorite food, preferred products and a lot more useful information which are basically needed for marketing purposes.
That’s right! The reason is the market. Imagine MySpace, Friendster and Facebook as a huge piece of survey sheet. The only differences would be: survey sheets aren’t as interesting as the features social networks provide; survey sheets aren’t as fancy looking as web pages, they tend to look boring and uninviting; survey sheets do not allow up-to-date information to be disseminated while with just a push of a button on a certain web page, it would only take seconds and the information gathered would already circulate all over the globe; finally, survey sheets only cover a limited region, unlike social networks, data are sent worldwide.
If companies have graphical charts about specific information on what the general public truly needs, they’d determine their target market. They would have control over the people’s interests and wants. This would allow them to have an idea on what, when, where, why and how to distribute their products. Definitely, the key to success is information. Planning is always their first step. They wouldn’t want to waste their investments for projects which would seem to have no direction. 
Would you say "there’s nothing to worry, registration is free"? I doubt you would if I tell you there’s a great risk. In exchange for the excitement and joy over socializing, you’d soon deal with losing your privacy. 
Tags: Identity Theft, Identification Fraud, Privacy and Social Networks.
How Social Networks make money
You might be wondrin’ how social networks such as MySpace, Friendster and Facebook earn money. In this article, I’ve included the biggest reason of free registration on social networks. It includes the risks and other important factors of privacy.
Trackback by Blogsvine — June 2, 2008 @ 5:52 pm
You have got a good point. Its interesting to know that they are interested in collecting our Personal Identification Information.
Comment by Agent 001 — June 2, 2008 @ 5:59 pm
Not really that they are interested with collecting PII.. Think about this, would the information they’ll gather be effective if they’ll just collect some from 100 people only? They need massive sources.. It is to become much more informative, at the same time, minimizes the percentage error among the information being collected.. They will of course consider the reliability of the information they have…
Comment by Ronald Borla — June 2, 2008 @ 11:05 pm
interesting blog
Comment by jongie — June 7, 2008 @ 11:44 am