Mark Zuckerberg is a greedy son of a bitch. That shouldn’t come as a surprise to most folks. But what is surprising is that major multinational institutions feel the exact same way. According to a recent article published by Bloomberg Businessweek, “CNN Has Had Enough.”
With the advent of YouTube amassing unprecedented viewership, Facebook naturally wanted a piece of the pie. Its primary angle-of-attack was the news content sector, through which Zuckerberg introduced applications such as live video hosting. The idea here was to create a news hub delivering 24/7 streaming content to Facebook’s nearly 2 billion-strong users.
Initially, media giants like CNN were game. Mainstream television viewership were being gutted at every corner, so the transition to Facebook made a lot of sense. Gradually, however, the benefit-spectrum skewed favorably towards Facebook, and not so much to CNN.
The content was hosted on the social media network, so CNN and company did not receive much increased residual subscribers. Furthermore, the contracts became more onerous on the media companies’ resources, while becoming more tangibly lucrative for Zuckerberg. According to Andrew Morse, general manager of CNN’s digital operations, “Facebook is about Facebook.”
Presently, media corporations are putting up with the skewed dealings because they feel they have no other options. Is this then the golden opportunity for blockchain-powered social media upstart Steemit?
Ironically Limitless Potential
On surface level, the ironic arrangement makes plenty of sense. Steemit is a direct competitor to all social media networks — and not just Facebook — by turning the reward structure upside down. Rather than practically limited revenue opportunities to the already rich and famous, the Steemit architecture theoretically allows anyone, including newbies, to start making serious money via their steem cryptocurrency.
This is made possible via the blockchain, where the supply and demand dynamics are tethered towards content creation, rather than “mining algorithms.” I personally use the example that Steemit “runs on talent.” Of course, the mainstream media corporations, with their army of credentialed journalists and loyal viewers, would make a killing if they joined the Steemit network.
If the mainstream were to join Steemit, it would represent a dramatic change of tone from the usual bashing of cryptocurrency assets like bitcoin. However, I would assume all would be forgiven based on the old saying: the enemy of my enemy is my friend.
But is discontent with Facebook enough to drive Steemit and the steem cryptocurrency?
Major Challenges with the Steemit Architecture
The problem with Steemit, as Eric Grisholm so brilliantly explained in Crush The Street, is that the social media network is a “centralized system backing a decentralized cryptocurrency.” Specifically, Grisholm refers to the steem reward structure.
Grisholm writes, “It’s extremely difficult to tell for certain whether or not Steemit is manipulated, but from the outside, it does not look like it. That said, the issue here is the unfairness due to having a centralized system for paying out Steem – even if it isn’t manipulated in any way, those that are ‘lucky’ enough to get a vote from a major holder are going to make a lot of money, while those that make posts that everyone else loves end up with nothing. For a site that claims it wants to pay out to those that create the best content, this just doesn’t make a lot of sense. Putting everyone on the same level would be a great solution to this problem.”
Indeed, the problem is even worse than Grisholm describes. My content has been flagged as “inappropriate” for a whole host of arbitrary reasons, including, but not limited to, differences in political opinions, advocacy of Constitutional rights, and ethnocentric rivalries. Lack of censorship is one thing, but when you invite all members to penalize others for any or no reason whatsoever, that is a very disconcerting system.
Steemit Can Choose to Win, and Win Big!
Recently, Steemit incorporated a hard-fork that resulted in increased reward-share allocation for newcomers. That’s a wonderful start, but only a start. To fully advantage the weaknesses in Facebook, Steemit must:
- Centralize punitive measures — I’ve noticed a substantial increase in “Robin Hood”-esque crusades against real and perceived infractions. However, Steemit is an international community, and laws (and customs) vary from country to country. In my opinion, it’s far better to have a central Steemit authority distribute punishments, lest the network devolve into vigilantism.
- Mandate copyright and plagiarism protections — This is the big one. There’s no way any mainstream multimedia company will eschew Facebook in favor of Steemit if copyright and plagiarism run rampant. The earning of the steem cryptocurrency further complicates these legal matters because Steemit is de facto a commercial operation.
- Content reward evaluation — I second Grisholm’s advice wholeheartedly. Steemit values “reputation” way too much. I find greater value in a well-researched editorial submitted by a low-scoring Steemit user than a post about a farting cat from a network whale.
Ultimately, the potential for Steemit to upend Facebook exists. But potential is not performance, and that still remains an open question.