Outrage is the business model

“We sell ads, senator.” The business model of social platforms like Facebook, Twitter, and Google is advertising. These companies have innovated everywhere but in their revenue streams. Advertising is very much a 20th century revenue model. What's more, out of those three companies, only Google has any other sources of profit.

Each company started by focusing on rapacious audience growth first. The business model was an afterthought. Something to graft on after the fact. As a result advertising has become an assumed default by VCs and other tech companies. Now it's the community that's the afterthought as ethical failure after another proves.

That business model is why they have North Star metrics like Daily Active Users. They need your eyeballs to make money. The more time you spend on their platforms means you’ll see more ads. God forbid, you might even accidentally click on one of the damn things. This is also why you see ads in more and more places: not only in the core feeds but in stories, messages, and more.

This is why our once quirky, random, charming web has devolved into one colossal attention harvesting mechanism. The Internet is chock full of “commercial junk” in the words of Tim Wu. At the centre of all this are “data factories” and “attention merchants” like Facebook and Twitter. They are all attempting to capture your most scarce resource — your attention — and take it hostage for money. Your captive attention is worth billions to them in advertising revenue.

Facebook's "reactions" are based on decades old junk science. American Psychologist Paul Ekman surmised that all humans, everywhere, experience and express the same six basic emotions in the same way. Margaret Mead’s anthropological studies debunked Ekman's theory with vim and vigor. But it’s simplicity makes it resilient and so it comes in and out of vogue with tech companies as they try to monetise around our emotions. The obvious downside is systems that only let us express ourselves with these limited emotions risk reinforcing them in a terrible self-fulfilling loop.

What's worse is the fact that some emotions are more equal — and more profitable — than others. Yale Neuroscientist Molly Crockett says outrage is what drives viral social media posts. Happy posts are a very distant second. “Anger is a gift” is a lyric to an old favourite song of mine from the 90s. Today it’s more truthful to say “anger is a commodity.”

Because of this, social media makes outrage more prevalent AND more potent at the same time.

It’s more prevalent because social media platforms make it a lot easier to express outrage. The tools for doing so are at our fingertips 24/7. The cost of expressing outrage is lower on social media than in real life — no one’s going to punch you in the face online (if you’re working in mixed reality to solve this problem then I’d like to invest in your tech).

It’s more potent because it’s self-reinforcing. We react more angrily online than offline. And we know this to be algorithmically true thanks to research done by William J. Brady, a researcher at NYU. Brady studied hundreds of thousands of tweets, and found that posts using moralistic and emotional language receive a 20% boost for every trigger word used. Put simply, "we click more when we're angry."

This is good business for the social media platforms. Outrage begets more outrage. It’s not a virtuous cycle but it is a very profitable one.

File under: #outrageeconomy #businessmodels
Next week: What the outrage economy is doing to us as individuals (spoilers: it’s not pretty)