Raise your hand if you’re tired of how current social media platforms are mistreating you.
The recent Facebook hack, which leaked a staggering 550 million users’ private data on the web, has once again emphasized the urgent need for a drastic overhaul of our connected digital worlds and the reining in of the monopolistic tech giants that shape them.
Web 3.0 proponents believe that the Semantic Web will soon remove any need to further tolerate the systemic flaws that centralized social media giants like Facebook, YouTube and Twitter appear either unable or unwilling to fix before the U.S. Congress or European Commission forces them.
These are dangerous problems. Personal data breaches and exploitation, fake news proliferation and increased censorship have far-reaching consequences for the victims, yet mere slaps on the wrist for these serial offenders.
Yet, despite all its setbacks, the bloated but well-oiled Facebook money machine blunders on, somehow increasing its revenue from $70 billion to $85 billion in 2020 as the world fell apart. The social media giant knows how to make money, even if it comes at the expense of its users, who it sees as both consumer and product.
Current social media monetization methods, such as retargeting, ill-timed video interruptions and irrelevant, low-quality sponsored ads are becoming nearly impossible to tolerate. And these are only the ones we know about.
Can Web 3.0 social networks really do it better though? Without falling into the same old monetization pitfalls and thereby decimating the user experience as Facebook and others have done in order to prop up profits for shareholders?
I spoke to Subsocial founder and chief architect Alex Siman, an experienced developer, Polkadot ambassador and one of the most qualified people to explain why decentralized social media will be such a game changer once Web 3.0 unfurls its nodes over the planet.
His project Subsocial Network is an ambitious new decentralized platform which uses blockchain technology to revolutionize the way social media users’ interactions are monetized, without encroaching on their data and privacy rights.
While not treading totally unfamiliar ground, Subsocial certainly offers a more compelling use case than other projects in the blockchain space right now.
What Is Subsocial?
Alex: Subsocial is a new decentralized social media protocol and Web 3 Foundation grant recipient currently being built on the Interplanetary File System (IPFS) and Substrate, the powerful blockchain framework on which the Polkadot technological stack operates.
Currently in its testnet phase, Subsocial already boasts over 2,200 “spaces” or groups where users interact with content creators. On Apr. 4, it was announced that Subsocial also received one of only 16 auction spots on Polkadot’s parachain Rococo testnet.
Subsocial was one of the first 17 projects handpicked by blockchain developer Parity to participate in its Substrate Builders Program. It has since delivered on all five milestones set by the Web 3 Foundation, and received high praise from Polkadot founder Dr. Gavin Wood, who has seen it forming part of both the Polkadot and Kusama ecosystems as far back as 2019. Subsocial hopes to connect as one of its forthcoming parachains later this year.
How Does Subsocial Work?
Alex: In short, the Subsocial platform consists of two primary parts. One, an independent blockchain built on Substrate (which hosts its custom social networking modules), and two, a decentralized application (DApp) which functions as a social network and for which a cross-platform mobile app (Android/iOS) will be developed later this year.
Subsocial will help creators to effortlessly build their own decentralized versions of social networks, market places and platforms such as Reddit, Instagram, Twitter and Medium, allowing its social media users to do anything that they’re used to doing on traditional social platforms.
So far, this sounds like more of the same. What makes it different?
Alex: Well, for starters, both Subsocial creators and users will be able to share fairly in the success and growth of their social media platforms. While this type of incentivization has already been tried on platforms like Steemit with varying degrees of success, Subsocial is taking it much further.
Subsocial is being built on Substrate as well as the InterPlanetary File Sharing (IPFS) system, which will allow for the distributed file storage of essentially any type of content, including text, images and video. Its architecture is designed to allow news feed customization, full-text search, and greater data transparency.
The Subsocial blockchain also has an open, permissionless API for applications to fetch data out of the box, similar to other blockchains like Bitcoin and Ethereum.
This will allow the platform the flexibility to incorporate several DeFi elements, which will enable users to accept cryptocurrency payments for a massive array of content types and forms.
For social media though, the big question remains, how can you popularize decentralized social media and monetize it effectively enough so that it can thrive and scale accordingly?
In its lightpaper, Subsocial lists a number of potential revenue streams it is currently exploring, which incorporates the most progressive current areas of the crypto space, including decentralized finance, smart contracts and non-fungible tokens (NFTs).
How Can You Monetize Social Media on Subsocial?
According to Alex, there will be multiple ways to monetize content in Subsocial, all aimed to bring more value to creators and provide better and more relevant content to its users.
Let’s take a look at six of the most promising revenue mechanisms that Subsocial is set to utilize later this year.
Subsocial’s community platform Space will enable users to either create a personal blog, where only they can publish content, or a public group, where page followers can contribute content as well. In the case of public groups, users are free to assign moderator and editor roles to any account.
There are tons of choices among traditional social media platforms that users can recreate on Spaces. For instance, emulating Stack Overflow would allow users to freely create a space where anyone can post a question and provide cryptocurrency rewards to those who contribute to an answer. Or Patreon, where users can build a space that receives earnings out of paid subscriptions and community votes.
Any content can be monetized further and provide more value flowing to the content creator if intermediaries are removed.
Subsocial will allow its users to hand out Tips, essentially cryptocurrency gifts to reward any post, comment or space, thereby incentivizing community contribution and interaction. Additionally, this will allow anyone to easily send donations or set up a subscription for other content creators on the platform.
Smart Contract Payments
Smart contracts will allow the Subsocial Network to remain decentralized, by eliminating the need for any third-party to facilitate transactions. The implementation of smart contracts on Subsocial is going to enable developers to establish advanced payment options that fit the preferences of individual users or their communities.
Space owners, for instance, will be able to freely create their own unique monetization method or launch contests specific to their needs and niche.
This is in clear contrast to other more rigid current options like Steem — where you have one global incentivization model that is based on inflation of their native token, and new token distribution is based on user comments and perceived best comments.
Non-fungible tokens (NFTs) are 2021’s zeitgeist experiment, and with good reason. NFTs are unique digital assets that function as blockchain representations of anything, whether they be flight tickets, collectibles, artworks, music files or even tweets.
There has been recent news of popular figures tokenizing their tweets. Twitter and Square founder Jack Dorsey sold the first tweet he ever made for $2.9 million, while Elon Musk’s tweet about NFTs is going for over a million dollars at present.
Subsocial plans to take NFT monetization a step further by not only allowing its users to sell their posts as NFTs, but also to even rent them out, thereby generating recurring income and better monetizing their most engaged content.
Subsocial plans to enhance promoted comments in a fun and innovative way. Users can create promoted comments and mentions on its decentralized social media platform.
Ideally, influencers will be able to set a preferred price for guaranteed notifications about their comments. This feature will help to incentivize Space influencers to share their knowledge and expertise with other users and may be especially valuable with trending or educational content.
For example, if an influencer is mentioned in a user comment, they can be rewarded (stake) for their expert replies. However, this reward will need to be locked for a short period, as mentioners could exploit the system by drawing in influencers and then cancelling the paid mention after the influencer begins to engage but is yet to reply in detail.
Users will be able to post relevant questions and set up a reward for good answers. Imagine the potential of a monetized Quora or Stack Overflow where respondents are fully incentivized to deliver high-quality answers to the betterment of the whole community.
Of course, there might be instances where an inquirer tries to game the system and refuses to reward even genuinely exceptional answers to his or her question.
In such cases, the Subsocial community can be involved to resolve matters by voting on the best answers. An to-be-decided allocation of the reward, say 50%, may then be awarded to the answer that gets the highest number of votes.
Subsocial is planning to allow influencers, KOLs and other content creators to mint their own “social tokens” or “space tokens,” unique digital assets for their spaces and communities. These assets will essentially be each space’s governance tokens, to be used for example to manage access or membership to a community and additional platforms like its Telegram or Discord group.
And like any other token, they may be gifted or used to tip posts or authors in a given space in the future. The beauty behind this concept is that space owners will be able to establish the tokenomics of their space’s assets, and customize and differentiate their social tokens to enable a variety of monetization avenues per a given space.
Subsocial users will be able to set up direct advertisement slots on their spaces and sell them directly to interested clients without any third-party or broker. Owners of spaces may put a price list for any slot on their space to monetize them and earn cryptocurrencies as per agreement.
Different parameters can be used to optimally price these slots. For example, space owners can establish flexible pricing by incorporating variables such as the display duration of an ad, its position, days of the week or times of the day it is displayed (thereby taking in geographical factors) or promotional enhancements like pinned posts. The options will be endless for space owners to tweak their ads to best serve their particular space timeline.
We are at a crossroads in the short history of the internet where we can witness a growing number of applications actively trying to reclaim the public’s control over personal data.
Thanks to the tide-shifting uptake of blockchain and cryptocurrency technology, users will hopefully soon be able to monetize their own data without having to tolerate the rent-seeking setup we have with today’s social media platforms, which have turned the consumer into the product.
At this moment, Subsocial is an emerging platform with increasing momentum from the Web 3 Foundation and Polkadot ecosystem that is boosting its chances of succeeding in this ambitious mission. The question is not whether platforms like this will replace existing social media options, but rather when. As with all types of social platforms, adoption and network effect will be key.
Subsocial already has a business model that will incentivize internet users and reward them for migrating to Web 3.0 applications. With a fair and democratized reward ecosystem for content creators, contributors and developers, the decentralized network is positioning itself well as an attractive alternative for users jaded by their poor experiences on centralized social media platforms.
Social media is ripe for a permanent disruption, with droves of users abandoning Facebook and Twitter, actively searching for more satisfying alternatives.
With viable options like Subsocial planning to live on the most promising decentralized networks like Polkadot, this may just be the year that social media’s outdated playbook is discarded for good, for something that above all, better serves its users.
The author of this article is an investor in Subsocial.