Social media: How it started, how it’s going | The Financial Express

Social media: How it started, how it’s going

Declining businesses and valuations, chaotic takeovers and management changes, mass layoffs, policy woes… what started as the world wide web’s biggest creation is now in the eye of a storm. Where is the social media ride headed, Shubhangi Shah finds out

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YouTube, in September, had announced the expansion of its monetisation plan allowing creators to earn through Shorts.

Declining businesses and valuations, chaotic takeovers and management changes, mass layoffs, policy woes… what started as the world wide web’s biggest creation is now in the eye of a storm. Where is the social media ride headed, Shubhangi Shah finds out

From Harvard dorm to global behemoth

Can you believe it has been 18 years since Facebook has been around? What started as TheFacebook in 2004 by four students at Harvard University has now turned into a multi-billion-dollar behemoth making its creator Mark Zuckerberg the face of social media inception and revolution.

Although initially designed for Harvard University, the platform shed ‘The’ from its name along with the exclusivity. Within months of launch, its user count hit a million, rightly indicating where the ride was headed.

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Then a controversy and a legal notice hit as twins Tyler and Cameron Winklevoss, both Harvard students, accused Zuckerberg of stealing the idea of Facebook. The lawsuit ended in 2008 with a settlement in which Zuckerberg paid the Winklevoss twins $65 million and Facebook shares.

woman hands holding a tablet PC computer with social network on desk in office

While this was on, Facebook kept evolving with a host of features, such as the Facebook Wall and Newsfeed, which now define the Facebook experience. Other features followed such as the famous Like button, which was enabled in 2009. Moving with time and anticipating the trends, it came on mobile in 2006, and the company launched its iOS app in 2008.

Swiftly claiming its way to become the social media behemoth, it clocked 500 million users in 2010, followed by becoming the third-largest web firm.

The year 2012 can be termed as important in Facebook’s journey as its 2004 inception. Not only did it go public, raising a whopping $161 million, but Facebook also bought Instagram, till then a dedicated photo-sharing app, for $1 billion in cash and stocks. Internal emails between Zuckerberg and his then CFO David Ebersman later revealed that the former went forward with the buy as he saw Instagram as a threat to Facebook. Two years later, it went ahead with another big buy, this time WhatsApp, for $19 billion.

influencer marketing concept: woman holding a 3d generated smartphone with influencer profile on the screen. Graphics on screen are made up.

If one thinks Zuckerberg’s tryst with extended reality (eR) began only last year with him announcing metaverse to be a major part of the company, going forward, and renaming Facebook as Meta, one cannot be more wrong. Way back in 2014, he bought virtual reality company, Oculus VR, and said in a post that the Oculus VR headset would “enable even more useful, entertaining and personal experiences”.

An interesting statistic in 2015 revealed that half of the global Internet users used Facebook, and the company pegged its number of users at 1.49 billion, which reached 1.5 billion the next year. In 2016, its number rose to 1.86 billion and brought it a profit of $10 billion, most of which was through ads.

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The company found itself in the eye of a major storm with the Cambridge Analytica scandal, which became public in 2018. According to it, the private data of millions of Facebook users ended up with Cambridge Analytica, a British political consultancy firm, and was then allegedly used to influence crucial political decisions such as the 2016 US presidential election and Brexit. While Facebook, in a statement, said it was “outraged and that it was committed to vigorously enforcing our policies to protect people’s information”, its chief Zuckerberg ended up testifying before the US Congress.

Close-up of hand holding smartphone with free WiFi hotspot icon on the screen to connect to wireless internet, public building interior in background

In the meantime, it kept changing its algorithm to keep it more focused on posts from family and friends, great for preserving the essence of Facebook but at the same time limiting the organic reach of companies and organisations. The platform, too, appears to have borne the brunt as numbers later revealed that users were spending less time on Facebook.

Facebook’s plateauing and ageing user base, with no more countries to expand further, is an issue for the company. Then there is TikTok.

After Facebook registered a dip in the number of users for the first time ever, Zuckerberg, in a fourth-quarter earnings call with analysts, could not help but address the competition rendered by the Chinese social media giant. “What’s unique is that TikTok is so big as a competitor already, and also continues to grow at quite a fast rate off of a very large base,” he had said.

While a stagnating user base is its global problem, there are issues with its India usage too, crucial as the country, with 489.9 million Facebook users, is its biggest market. An internal research, spanning two years till 2021-end, revealed men make up 75% of Facebook’s monthly active users in India, with many women shunning the platform due to safety and privacy concerns. Other problems included nudity content, literary barriers and perceived complexity of its app design, according to media reports.

hands of a man holding an influencer device over a wooden workspace table. All screen graphics are made up.

Despite the growing commentary on Facebook being a dead platform, creators still feel its potential. Digital marketing practitioner and content creator Pratiksinh Chudasama aka Digital Pratik enjoys a considerable following across social media platforms, including Facebook, where he currently has a following of 67K. “Many say that it is dead or no longer relevant, but the Facebook Reels and the overall platform have been giving organic reach for the past couple of months. It is a definite choice of platform for brand building in 2023, at least for me.”

Riding on the pandemic-induced digital euphoria, Facebook, renamed Meta, went ahead with a major push towards metaverse, touted as one of the pillars that might define Web3.0, the next phase of the Internet revolution. Amid mass layoffs, the company’s chief technology officer (CTO) Andrew Bosworth in a blog post recently reaffirmed the commitment towards metaverse. He said Meta will continue to devote about 20% of its costs to Reality Labs in 2023. “It’s a level of investment we believe makes sense for a company committed to staying at the leading edge of one of the most competitive and innovative industries on earth,” he said. However, the majority of its costs and expenses will continue to go towards its core business, which includes what it calls its ‘family of apps’ —Facebook, Instagram and WhatsApp.

Close-up Of Person Hands With Mobile Phone Showing News Over Wooden Desk

Speaking on this push for metaverse, Nick Klegg, Meta’s global operations’ head, during an Idea Exchange session of the Indian Express recently, said, “There are whole areas of growth we are really excited about, many of which, by the way, we pioneer here in India. In the end, a tech company, in particular, has to be forward-looking. We have been investing billions of dollars into these augmented virtual-reality products for years. It’s just that no one noticed it until we made it more explicit. In many respects, by renaming the company Meta, we were making explicit that which was previously somewhat implicit.”

Chandrashekhar Mantha, partner at Deloitte India, says: “India is on the brink of a 5G revolution that may increase the adoption of technologies like AR/ VR, wearable tech and Metaverse. This, coupled with our favourable population demographics and increased smartphone usage, we may continue to witness a positive trend in social media usage for the coming years. Brands will lead innovations with experiential offerings in the Metaverse space and we may see bundled offerings with newer currencies like NFTs.”

Pretty pictures to mobile celebrities

“I started creating content on Instagram after TikTok was banned in India and the former started to aggressively promote its short-form video feature, Reels,” says Shreya Jaiswal, aka ‘the_unconventional CA’, a chartered accountant and ‘finfluencer’. “So, the 60-second feature, which is actually a challenge for my niche, is exactly what worked wonders for me,” says Jaiswal, who makes finance-related content and has over 1 lakh followers on the platform.

Although intended to be a photo-sharing app initially, Instagram has transformed to include features ranging from the widely popular Reels to Stories, Notes, and much more, and has given a major boost to influencer marketing.

Founded in 2010 by software engineers Michel Krieger and Kevin Systrom, to share pictures with filters on, it was bought by Facebook in 2012. By 2018, it had over 1 billion active monthly users.

Although video has become its core feature for the past few years, it was unveiled way back in 2013. Instagram Stories, a copycat feature of Snapchat, came in 2016.

A widely popular app globally, Indo-Pacific is its biggest market, with India, with over 300 million active users, being the biggest one. The impact of this huge number is evident from its ‘Reels in Review’ report, 2022, as per which 15 of the top 20 most used songs on Reels worldwide were from Indian artistes. These included Srivalli by Javed Ali, Kesariya by Pritam, Arijit Singh and Amitabh Bhattacharya, Gypsy by GD Kaur, and the KGF 2 theme song.

This lone app has birthed a large number of influencers. “Instagram is the most visual platform,” says Ayush Wadhwa, content creator, entrepreneur and founder of Owled Media. “It allows me to experiment with different facets of myself as a photographer, videographer, and editor, and it has the ideal features for posting various types of content. I was also never the type to bombard the Internet with a lot of text, so this became my go-to,” says Wadhwa, who boasts of over 2 lakh followers on Instagram.

Similarly, Digvijay Singh, who posts health-related content on Instagram and YouTube, says, “Every platform helps you serve a different purpose. Instagram helps you break even with your business because the growth and revenue are quicker. To build a 100k audience, it will take you 3 times less time and effort as compared to YouTube. Whereas YouTube helps you build a loyal community.”

Although the quest for exponential growth has attracted many, there are troubles too, especially regarding changes to its algorithm. “As a creator, I have seen Instagram change dramatically in both good and bad ways. Sometimes you feel like a puppet, following the platform’s and algorithm’s commands,” says Wadhwa.

As a user, too, the experience has varied much. “MAKE INSTAGRAM INSTAGRAM AGAIN. (stop trying to be tiktok I just want to see cute photos of my friends.) SINCERELY, EVERYONE.” This single post by Kylie Jenner, one of the most-followed people on Instagram, opened a floodgate of commentary on how Instagram has changed from a place for pretty pictures to a TikTok-lookalike. For creators, too, this push for short-form videos can be an issue. “I used to love pictures, but they don’t work as well as they used to. I miss the days when people would post beautiful photos on Instagram and the community of photographers and storytellers would simply celebrate them. It’s a slightly different platform now. I’m also trying to adapt to the change,” says Wadhwa.

However, there isn’t an iota of sign that Instagram is returning to its original course, especially with Zuckerberg openly addressing the competition faced by the Chinese short-form video behemoth. It has also moved ahead with curated feed, instead of chronological or personal, with the algorithm showing you posts it thinks you might be interested in, which is another TikTok trademark.

It seems to be working though, with the platform growing in stealth, both in terms of users and revenue generated. Quite contrary to Facebook’s plateauing user base, that of Instagram is a steadily growing one, from 110 million in 2013 to 1.89 billion last year. Last year, it generated an estimated revenue of $47.6 billion, accounting for 44% of Meta’s overall revenue, and is expected to surpass Facebook as Meta’s main source of revenue by 2024, as per reports.

From 140 characters to endless conversations

From breaking news to even policy announcements by decision makers, Twitter has become somewhat of a go-to site for news-focused content.

The journey began in 2006 with co-founder Jack Dorsey’s tweet “just setting up my twttr”. Among the major additions to the site include a blue ‘verified’ tick and hyperlinked hashtags, which it introduced in 2009.

Like any other social media platform, Twitter earns the major chunk of its revenue through ads. Hence, it began the promoted tweets feature in 2010, followed by promoted trends and promoted accounts.

Two of the biggest changes in the pre-Elon Musk era were switching from chronological timeline to an algorithmic one in 2016 and doubling the character limit to 280 two years later, apart from going public in 2013. However, nothing trumps the roller-coaster ride that followed post the platform’s $44-billion buyout by billionaire technocrat Elon Musk. From mass layoffs to taking major policy decisions based on Twitter polls, Musk has done it all.

It largely started with the ‘$8 for blue tick subscription’ feature, which, apart from other things, can be seen as a sign of the platform taking a small step away from the dependence on ad revenue. However, he did not stop here and unveiled gold and grey coloured check marks too. “We’ve gone from a single verification, which worked perfectly, to: legacy tick, paid tick, business tick (yellow), business associate tick (blue), ‘official’ notable tick (blue), and now these silly bird logos as well,” a user commented. “This is almost what over-engineering looks like,” another user tweeted.

Despite Musk’s growing commentary on free speech, the platform went on suspending ElonJet, an account that doxxed his location real-time. It also banned links to rival social media platforms, such as Facebook and Instagram. The platform reinstated the suspended account of former US president Donald Trump following a Twitter poll by Musk. It will be interesting to see how the platform’s content moderation policy will pan out.

Looking at Twitter’s standing among social media platforms, it is not even in the top 10 in terms of the number of users, which currently is 436 million. Last year, it generated revenue of about $5 billion, which looks fickle compared to Meta’s over $110 billion. However, it remains popular given its news-focused approach, making it conducive for breaking, trending and viral news. “Twitter works best for highlighting news or trends in real-time,” says Digital Pratik, adding: “With more and more entrepreneurs, business owners and professionals joining the platform, it only makes networking easier. I have been consistently active in communities engaging with people through conversations and content creation. It’s all about the community now!”

Casual videos to a creator economy

“Every creator must break even, have some cash flow with Instagram and then move to YouTube to build a brand for themselves,” says health coach Digvijay Singh. YouTube has birthed several celebrities, who started with vlogging, teaching, gaming, comedy, etc, on the platform. Aiding creators to garner a dedicated audience continues to attract creators to the platform. Revenue sharing through its partner programme, which allows creators to directly monetise their content, too, remains an attractive avenue. The unveiling of Shorts has only incentivised short-form video creators, who initially made content on TikTok, followed by Instagram Reels, to look at the Google-owned platform, too, to broaden their reach.

“Being visible on both of these platforms (YouTube and Instagram) is an advantage. While the latter gives you popularity, the YouTube audience is very supportive, more so than Instagram,” says Ronit Ashra, who has over 1.7 million followers on Instagram and 711 YouTube subscribers. “YouTube builds a fanbase like no other and is a great way to widen your horizons,” says Ashra, who garnered a sizable audience through his rib-tickling mimicry videos.

Sharing her experience on both Instagram and YouTube, content creator Sakshi Keswani says, “Starting from scratch was tough as neither my Instagram nor YouTube channel was expanding. I was limited to just 1,000 views. However, slowly, things took off. Now, I have a larger following on YouTube than Instagram. There are times, my YouTube shorts videos receive more views than my Instagram Reels.” “It’s true that short-format videos get a lot of engagement, but long-format videos attract the most devoted and cult-like viewers,” says the creator, who makes comedy sketches on the platform.

The thought is seconded by Abhijeet Kain, who boasts of 1.2 million YouTube followers and 198,000 YouTube subscribers. “Both platforms have advantages. But as a creator, I have observed that Instagram helps me put forth my creativity and YouTube helps me reach a greater range of audiences,” he says.

YouTube, in September, had announced the expansion of its monetisation plan allowing creators to earn through Shorts. This feature is expected to grow further. According to Shubham Singhal, CEO of Dot Media, “Although Instagram and YouTube are the most popular social media platforms, our market analysis indicates that YouTube Shorts is most likely to grow and foster the creator economy due to its wide audience demographic.”

Anshuman Sharma, who makes personal finance content on YouTube, finds Shorts “a great feature that allows you to reach out to an audience (casual short form viewers) which is very different from your general audience (more patient viewers). But it is very difficult to build a community which is the only way for a creator to survive in the long run. The dilemma is about faster growth in subscribers versus building a loyal community.”

There is good news for Sharma here. According to Singhal, “There is bound to be a shift from short-form content to long-form. While our attention span has decreased, we are still hungry for entertainment. Both creators and brands are bound to explore the long-form content space, to expand their reach and keep their audiences engaged.” Another feature that works for Sharma is that YouTube doubles up as a search engine. “This helps me get views even after months of posting a video,” he says.

With 467 million users, India is YouTube’s biggest market. Its expanding base of creative entrepreneurs contributed over Rs 10,000 crore to the country’s GDP in 2021 and supported the equivalent of 7,50,000 full-time jobs, YouTube said citing a report by Oxford Economics, a consulting firm. Its 2020 report stated that its creator ecosystem contributed Rs 6,800 crore to the GDP and supported the equivalent of 6,83,900 full-time jobs.

Although the creator economy continues to thrive, YouTube earnings were down about 2% to $7.07 billion from $7.21 billion in the FY22 Q3. This was the first-ever dip since Google started reporting.

Professional networking to influencer marketing

Anyone who uses LinkedIn regularly will second that the platform has evolved from a professional networking site to more than jobs, especially content creation. Last year, it introduced a 10-week ‘creator accelerator programme’ in India offering coaching, networking opportunities, and a financial grant to 200 creators to amplify their voices, grow communities, and share content.

“There is obviously YouTube and Instagram,” says Anushree Jain, co-founder of SocialTag, on the most lucrative social media platforms for influencer marketing. “ But Linkedin is something we’re keeping an eye on. We believe that LinkedIn is the platform that will grow for fintech and edtech firms because it has a paying audience. As a result, brands who are advertising on LinkedIn are aware their audience is being reached because they can afford to do so,” she explains.

So, is an influencer culture developing on an essentially corporate networking platform? LinkedIn India’s country manager Ashutosh Gupta says, “Since the onset of the pandemic, LinkedIn has seen an exponential rise in public conversations—we saw a 25% y-o-y rise in public conversations from FY2021 to FY2022. With more people sharing their stories and knowledge on LinkedIn, content remains at the centre of connecting people to opportunity on our platform.”

“Today, with the exponential value that LinkedIn has to offer, we see many members investing their time in creating content and building their voice that is engaging and educative for their networks and communities,” he adds.

One aspect of LinkedIn that appeals to users is the ease in making connections. “LinkedIn helps to grow my network without any extra effort from my side. When my followers like my posts, it automatically reaches out to their followers as well, creating a ripple effect and helping me and my content to reach out to a maximum number of people to provide the value they are here for,” says Ansh Mehra, content creator and product marketing manager. Another aspect he likes is the focused conversations on the platform.

It helps with business, too. “LinkedIn has been an incredible experience ,” says Owled Media founder Ayush Wadhwa, adding: “I believe that having a large following there has been extremely beneficial in terms of accessing social capital because I run a marketing company while also being an entrepreneur. It builds enough trust in the market for me to effectively cold outreach.” Speaking on the push for creators, he says: “It has also been promoting creators and pushing various types of content in the last nine to ten months. So, I believe that more creators will flock to LinkedIn, now that everyone wants to diversify and move to various platforms.” “It has become a professional Facebook for 2023,” adds content creator Digital Pratik.

Building on the local connect

For good or bad, the leadership change at Twitter has brought much upheaval to the micro-blogging landscape allowing many alternative platforms to benefit. One such is India’s very own Koo. Although initially riding on the government’s ‘Make in India’ push, the platform has found new avenues for growth following changes at the biggest micro-blogging platform.

A site that takes pride in being multilingual, which “our biggest strength,” according to co-founder Aprameya Radhakrishna, blew up in Brazil as it included Portuguese as the 11th language on the platform.

Although Hindi-speakers currently comprise 60% of its users, the company is eyeing at expanding beyond India. “We are enabling all global languages and making the app experience localised to those countries. We will soon have localised location and language experiences going live in the US, UK, Indonesia, Japan, Mexico, Argentina, Middle-East and many more geographies,” its co-founder said.

However, the biggest Twitter-alternative tag might not be enough for its growth as the former is still formidable for its huge user base and user-friendliness. “Yes, I am on Koo but not as active as I am on Twitter. I personally feel it needs a lot of user friendliness when it comes to navigating the app, especially when we are trying to compare it with Twitter,” says content creator Digital Pratik.

Just like changes at Twitter seems to have benefitted India’s homegrown Koo, the ban on TikTok led to the growth of several indigenous short-form video apps, with Moj, Josh, Chingari and Roposo being the biggest ones.

According to Dimple Paul and Shambhavi, content creators on Chingari, it is the ease to use the app along with monetisation avenues through cryptocurrency that appeals to them. The app’s co-founder and CEO Sumit Ghosh, too, hails Chingari’s “GARI Social Token” as its USP. “We took the first step toward becoming a Web3 company in 2021 by introducing GARI Social Tokens. The tokens were created to allow creators to monetise their content on the app, as well as to give users governance powers, further strengthening the community. In 2022, we launched the ‘GARI mining programme’, which rewards tokens for a variety of in-app activities such as creating, watching, liking, and commenting on the app,” Ghosh says.

However, niche creators popular on larger platforms, notably Instagram and YouTube, find the homegrown apps less user-friendly. “Both YouTube and Instagram provide due gratification to users and creators and have a user-friendly UI/UX, which is where India’s homegrown short-form video apps lack. If a similar platform were to come up like Instagram and YouTube, I would be open to trying it out as I am always up for a challenge and looking forward to new experiences,” says content creator Sakshi Keswani.

Seconding that, content creator Abhijeet Kain says platforms like YouTube and Instagram have a user-friendly algorithm, unlike India’s current domestic short-form video applications. “If a new enterprise such as Instagram were to materialise, I would be prepared to try it out,” he adds.

Despite that, according to a report by Redseer Strategy Consultants, India’s indigenous short-form video apps are expected to double their monthly active user base to 600 million by 2025. They have a monetisation opportunity of $19 billion by 2030, it adds.

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First published on: 08-01-2023 at 00:35 IST