How TikTok broke social media

From The Economist:

Is tiktok’s time up? As the social-media app’s chief executive, Shou Zi Chew, prepares for a grilling before Congress on March 23rd, TikTok’s 100m-plus users in America fret that their government is preparing to ban the Chinese-owned platform on security fears. Their anguish contrasts with utter glee in Silicon Valley, where home-grown social-media firms would love to be rid of their popular rival. With every grumble from Capitol Hill, the share prices of Meta, Snap, Pinterest and others edge higher.

TikTok’s fate hangs in the balance. But what is already clear is that the app has changed social media for good—and in a way that will make life much harder for incumbent social apps. In less than six years TikTok has weaned the world off old-fashioned social-networking and got it addicted to algorithmically selected short-form video. Users love it. The trouble for social apps is that the new model makes less money than the old one, and may always do so.

The speed of the change is astonishing. Since entering America in 2017, TikTok has picked up more users than all but a handful of social-media apps, which have been around more than twice as long (see chart 1). Among young audiences, it crushes the competition. Americans aged 18-24 spend an hour a day on TikTok, twice as long as they spend on Instagram and Snapchat and more than five times as long as they spend on Facebook, which these days is mainly a medium for communicating with the grandparents (see chart 2).

TikTok’s success has prompted its rivals to reinvent themselves. Meta, which owns Facebook and Instagram, has turned both apps’ main feeds into algorithmically sorted “discovery engines” and launched Reels, a TikTok clone bolted onto Facebook and Instagram. Similar lookalike products have been created by YouTube (Shorts), Snapchat (Spotlight), Pinterest (Watch) and even Netflix (Fast Laughs). The latest TikTok-inspired makeover, announced on March 8th, was by Spotify, a music app whose homepage now features video clips that can be skipped by swiping up. (TikTok’s Chinese sister app, Douyin, is having a similar effect in its home market, where digital giants like Tencent are increasingly putting short videos at the centre of their offerings.)

The result is that short-form video has taken over social media. Of the 64 minutes that the average American spends viewing social media each day, 40 minutes are spent watching video clips, up from 28 minutes just three years ago, estimates Bernstein, a broker. However, this transformation comes with a snag. Although users have a seemingly endless appetite for short video, the format is proving less profitable than the old news feed.

TikTok monetises its American audience at a rate of just $0.31 per hour, a third the rate of Facebook and a fifth the rate of Instagram (see chart 3). This year it will make about $67 from each of its American users, while Instagram will make more than $200, estimates Insider Intelligence, a research firm. Nor is this just a TikTok problem. Mark Zuckerberg, Meta’s chief executive, told investors last month that “Currently, the monetisation efficiency of Reels is much less than Feed, so the more that Reels grows…it takes some time away from Feed and we actually lose money.”

Link to the rest at The Economist

6 thoughts on “How TikTok broke social media”

  1. There is absolutely a generational divide, below which the cohort watches tiktok, and lots of it. Above which, it is not such a thing, if at all, and above that it is “what’s tiktok?” Facebook runs the terrifying (to them) risk of going the way of paying your gas bill in person. It will be a thing until most of it’s users die, then it will be over.

    As far as being “banned” goes, most of what’s proposed today is to ban the program from government devices, which shouldn’t be running tiktok anyway because it’s a towering waste of time. The only really achievable next step is to ban the app from the major app stores, and if that were to happen, young people would become experts in sideloading overnight – not to mention quite peeved at the authorities who made that ban happen, with interesting and unpredictable political results.

    • In another 10 years or so, as TikTok users age, it too will become old and passé.
      Like all social media before it, in the past 30 years. And youth fads before it, just like in the past 100 years.

    • So far TikTok is only banned from government facilities and employees but Congress is looking at a total ban. It’s not just populist presidents (plural) who worry about user personal data being collected and routed to Beijin. (Documented by multiple whistleblowers.)

      It would be not too different than the US/EU deal to keep euro users data on EU servers out of reach of the DOJ’s subpoena power. They don’t trust crazy judges on either side of the pond (or the 49th parallel). Why trust the CCP who keep a billion person database tracking their serfs?

  2. Sigh. Just as I am thinking about seriously learning about TikTok (BookTok specifically because of the sales statistics – which don’t apply to me, I keep telling myself), it is going bye bye.

    I couldn’t watch it for 30 seconds, but that’s me – brain-damaged and chronically ill people with no energy don’t like moving and flashing stuff on their screens – but maybe some new readers…?

    Oh, well. Back to the drawing board (which we used with T-rulers (is that how you say it in English?) and fine drawing pens – because new people just use their phones.

    If my amazing beta reader were not forty years younger than I am, and gets me perfectly, I wouldn’t even bother thinking about her demographic; she may be unique, or at least rare: she wants to be a writer, and is actively doing it.

    • “T-square.” Or, at least, that is what my first drafting teacher called them.

      Highly useful things. Although I long ago gave up my big drafting table for a couple square inches of computer disk space, I still have my three. When doing carpentry, and all that you want is to mark a right angle cut line, they’re easier than a combination square.

      • Thanks. I should have tried harder to find a translation.

        All of our stuff was sold or given away when we moved to a retirement community, but I think they have them both in the arts and crafts facility and the woodworking/shop facility.

        They went along with drafting tables and very neat block printing.

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