With users providing all the content for social media platforms, should we get paid advertising revenue for using them?
With the rise of social media sites like Facebook and Twitter, more sites are using targeted advertising to generate revenues from their users. However, with social media users providing all the content for these platforms, this gives rise to the question, should we get paid advertising revenue for using these platforms?
How much money does a site like Facebook generate per user?
At the time of Writing the market capitalization of Facebook stands at $188 billion – A dizzying height from it’s $100 billion pound flotation price in May 2012 just over 2 years ago.
With Facebook’s reported monthly active users at 1.23 billion as of 29th of July 2014, this gives us a company value per user of approximately $152. Lets look at some more ratios surrounding social media sites based upon current market cap and profit figures for 2013:
All sources / references have been linked. That being said it is hard to find concrete figures on social media site revenues and user figures, so please take the above at ball park figures. Gross profit has been used for profit calculations.
With the exception of Facebook’s other revenue streams of games etc, these sites make a great deal from advertising to their users. And who provides the content that the users come to the site for? The users. Although it would not make economical sense to pay all users, how about just paying the top 10,000 users that generate the most clicks? How much advertising revenue does a fairly active user create? To try and answer this question lets look at a case study.
How many page views does a fairly active social media user create? Lets look at a case study
Two weeks ago, Steven joined the social network Google+. Google+ differs from other social networks such as Twitter and Facebook in that it shows a view count on your profile. Steven is a fairly regular user, mostly of Facebook, where he has around 850 friends, posts 4 to 5 times a week, and regularly checks his news feed, around 5-10 times per day, mostly when he is procrastinating at work. When he started regularly using Google+, Steven had around 400 page views, and 4 followers. Steven started adding other users, and posting, and two weeks later he had 2,600 views and was following around 100 people and had 7 following him.
If we use some very rough maths*, and say this equates to 2000 page views every two weeks per 25 friends on Facebook, this means on Stevens Facebook account he could well be getting upwards of 1.5 million page views per year.
*2000 views per fortnight <times> 34 times more friends <times> 26 fortnights in a year makes 1,768,000 page views per year
An Active frequent Facebook user could well be Generating upwards of 1.5 million page views per year
Looking at other sites where you can monetize your content, ie: display ads on you content to generate money from advertising, only very successful Bloggers and Youtubers will generate this amount of views on their content, and those that do can make up to $10,000-$15,000 per year from advertising.
However, blogging and making Youtube videos is more labor intensive than using Social media, and Facebook and other social networks create a really accessible, clean platform on which to connect and share content with others.
What do you think? Do you think the top Social media users should get paid for the advertising revenue they generate?