Posted on: Wednesday 19th of December 2012
No sooner had we completed our round up of the year than potentially the most momentous event of the year takes place: Facebook-owned Instagram’s attempt to unilaterally change its terms and conditions.
The London commuter paper The Metro reported it on its front page thus:
“WE’VE AD IT UP TO HERE, INSTAGRAM”
“Instagram has outraged its millions of users by threatening to sell their pictures for us in adverts.
“The photo-sharing site, bought earlier this year by Facebook, has updated its terms and conditions so it has control over the rights to any images which are posted.
“Its catch-all wording means photos and comments can be sold to other businesses – but users will not see a penny.”
The flare-up perfectly sums up the critical challenge of our information age in two ways.
Challenge Number One
In the 20th century one of the most powerful, prosperous and influential industries of the world made its money by monetising something individuals gave it for free: their attention. Newspaper and magazine owners, radio stations and TV broadcasters provided editorial content to attract individuals’ attention and then sold this attention on to advertisers.
In the 21st century, we are struggling to find a similar formula for information – information created and shared by people. One answer is to copy the 20th century media model lock, stock and barrel to say, ‘you give us your information free in exchange for a service, and we monetise that information’.
Trouble is, 20th century models cannot and will not transfer as easily and simply as that. The information we create and share online comes in many forms: photos uploaded onto Instagram, profiles and comments generated on social networking sites, all sorts of personally identifiable information. They all have different social and personal sensitivities. They each have their own commercial value, which varies greatly across different contexts and situations.
In this world the blanket formula ‘give us your information in exchange for a free service’ simply isn’t sustainable. It doesn’t answer any of the questions that arise, such as: How much information? What sorts of information? Used for what purposes? To create how much value?
It also fails to give individuals skin in the game. The information age is no longer about ‘consumers’ and ‘producers’. In the information age, individuals are also producers – producers of information. We will only find sustainable (i.e. win-win) business models when individuals get a fair share of the value of the information they produce and share; when their rights to manage and control their own information are recognised; when their personal data (including all the information the person generates) is recognised as a personal asset.
The key word in the above paragraph is ‘fair’ as in ‘fair share’. Instagram is saying ‘we have complete and total commercialisation rights over all the information you share with us. Your reward is a free service – and that’s it’.
In some cases, such a model may work. But in many cases it won’t – because individuals are handing over far too much value in exchange for very little indeed. Like the tribal chieftans who handed over mining rights in their land to colonial powers in exchange for a few trinkets.
Challenge Number Two
Enter our second big issue. Instagram is changing its terms and conditions unilaterally. It is not giving its users a say. There is no opportunity to negotiate. There is no possibility of a more nuanced option or agreement. This issue of unilaterally set and changed terms and conditions lies at the heart of the emerging information age accommodation.
The industrial age gave consumers a choice over which product to buy. Producers competed against each other to offer the best product.
In the information age, service providers will provide individuals with a choice of terms for information sharing, and different service providers will compete against each other to offer the best terms.
Facebook and Instagram are already saying ‘we’ve been misunderstood!’. But all the signs are it’s them that don’t understand. Until they realise they are not just a new form of media company monetising a freely provided consumer asset, they will continue to court controversy.
Meanwhile, the hard work has yet to begun. What does a viable, sustainable win-win information sharing relationship between individuals and organisations look like?