Thursday, February 11, 2010

Why is a Facebook beer worth more than your news story?

As Chris O’Brien asks at the PBS IdeaLab, “Why will people spend $1 to send you a virtual beer on Facebook, but not to read a news story online?”

Good question — and there’s a lot more than a dollar at stake. Americans are spending something like $1.6 billion a year for “virtual goods” — that is, things that exist only in cyberspace, like that Facebook beer, or status upgrades in a game — but we’re told they won’t spend squat on news. What’s up with that?

If you’re a journalist, your first impulse might be to ask “What’s wrong with them?” But a far more useful question is to ask “What’s wrong with us?”

There’s only one reasonable explanation: people spend discretionary money on the things that matter most to them. If it turns out that buying intangibles to enhance experience in a virtual (non-physical) world is worth more than consuming another isolated, incremental news fact, that’s where their dollars will flow.

These distinctions aren’t all black-and-white, of course. (Honestly, these days, what is?) Some news consumption is related to the immersive, satisfying virtual experiences people pay for; by and large, organizations that provide some of that experience — not just a collection of individual factoids written in a peculiar news dialect — tend to be doing better than those that don’t.

But news-as-social-community happens by accident nowadays. What would happen if a news organization set out to make its product immersive and satisfying on purpose?

Writing in TechCrunch, Susan Wu said, “Virtual objects aren’t really objects – they are graphical metaphors for packaging up behaviors that people are already engaging in.” That sounds like something that could very well apply to an online community defined by common interest in civic affairs, doesn’t it?

Sharing and caring about news is an inherently social activity.  “Everybody who is interested in Ahmadinejad” or “People worried about a property tax increase” certainly comprise communities. The problem is, news organizations don’t treat them like communities — don’t feed and nurture and satisfy them — and so they fragment and drift apart. Much of their value drifts away with them.

Why would somebody spend real money on a virtual rose or make-believe beer on Facebook? What Susan Wu said: because it’s a graphical metaphor: it stands for something, it’s part of an integrated system that rewards participation.

An individual news story is itself a virtual good. What’s missing is the community environment in which it is recognized as valuable, an ecology where caring about the news becomes satisfying and rewarding social behavior. Instead of becoming an integral part of a social community experience, consuming news stories remains an isolated individual act.

When somebody creates a social ecology around news, I’m willing to bet they’ll also create a place where the virtual goods we know as “news stories” become valuable for their creators.