social networks the next generation

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SocialNetworks

THE NEXT

GENERATION


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David A. SmithChief ExecutiveGlobal Futures and Foresight

November 2010


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Social NetworksThe next generation

ContentsForeword Chris van der Kuyl

Introduction David Smith

Executive summary

1. History of social networks in the digital age in the UK.2.1. The present state of social networks.2.2. Innovative uses of social networks in todays society

B2C - Business to ConsumeroB2B - Business to BusinessoP2P - Person to Person (Peer to Peer)oG2C - Government to Citizeno

3.1. Key trends shaping the future of social networksBroadband penetration1.Rise of mobile technologies2.Ambient technology - the 'internet of things'3.

24/7 lifestyle4. Data expansion5.The future of the net: web v apps6.Geo-spatial and augmented reality technologies7.New era of mass communication8.New business era9.Trust10.Education11.Older social networkers12.Gaming and virtual reality13.Government intervention14.

3.2. Tomorrows consumerB2C - Business to Consumero

E-Government and the 'Big Society'oEducational networkingoSocial studiesoGaming and virtual worldso

3.3. The evolution of social networksTechnological progressoBusiness models and revenue streamsoFrom the web to the streetoPrivacy/security/ permissive marketingoDigital Asset ManagementoLongevity of digital assetsoImpact on advertisingo

3.4. Changing Britain3.5. Conclusions

TimelineAbout the AuthorReferences


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Social networking has become morethan just how we keep in touch withour friends online. It has changed theway people communicate and howwe go about our daily lives. SocialNetworkings growth shows no signsof abating and organisations are alsousing it in more sophisticated waysto communicate with, and learnabout, their customers. The manynew ways we use social networkinghas meant an increase in onlineinformation. Our online presence isgrowing - what and how we shareand protect this information is moreimportant than ever. Organisations,too, must consider how they use thisdata to interact with people. The

Social Graph is rapidly becomingthe most important piece ofanyones online persona. The useof an individuals social graph isat the heart of almost every newcompany and idea around the onlineworld today. Collectively, we needto debate online privacy related tosocial networking and how we openup access to new content fromnewspaper archives to cherishedfamily photo albums - only then

will we move towards realising thefull potential of the internet andsocial networking.

But how will advances in socialnetworking actually impact howwe live our lives? Picture the scene- youre scheduled to meet up witha friend at a football match, yourdiary will connect with your currentlocation and your mobile devicewill tell you that the fastest way toget there is on a bus which is veminutes away. Two minutes later

your device sends an alert to saythat your friend has boarded the bustwo stops away. When you both getto the football match, augmentedreality technology will allow you tohold your mobile device up to thecrowd and will display arrows abovethe heads of all your friends. As wellas your usual match day mates younotice your best friend from schooltwenty years ago is in the crowd andwith a quick use of instant chat yound out hes back from Australia fora few days. With the simple use of alocation based check in service youcan easily arrange a venue for yourpost match meet up. Just beforethe nal whistle the venue sends

you all a message offering you therst round for free to celebrate yourteams win. It really will transformour lives!

Not only will we live our everydaylives digitally, but well also sharemore about ourselves online thanever before. With this comes agreater responsibility to safeguardour privacy and to protect andpreserve our own digital footprint.

It is becoming the norm for peopleto reveal their daily lives online, butsocial networking sites have beencriticised for how poorly usersprivacy is controlled. We need tostart taking control of our ownprivacy and for this to happen socialnetworks need to simplify privacycontrols, making it easier for us tounderstand what were exposingand to whom.

What about preserving our digitalfootprints? The success, or failure,of individual social networking siteswill rest on their ability, not justto serve the here and now but, tostore and protect memories andto enable users to move as freelythrough the past as the present.Precious moments will be lost foreverif we do not take steps to protectour personal history. Todays socialnetworks are anarchic and havenot been built for the long term.Thats ne if people are living in themoment but there comes a pointwhen an event transcends from thehere and now into something theymay want to look back on. We need

to protect our data for longevity orwere in real danger of becoming thelost generation.

Our ancestors had a physical recordof their memories, captured inhand-written letters, postcards andwell-thumbed family pictures, butalmost all the records of our childrenare online. There is a huge need todigitally store public informationand historical documents for future

generations. At brightsolid we havebeen at the heart of this drive todigitise the nations history andrecently announced a ten yearproject with the British Libraryto digitise up to 40 million pagesof historic newspapers. Werecollaborating with the publishersand rightsholders to help them takefull advantage of the revolution indigital technology, for the benet ofus all. We could all make more of thishuge opportunity if copyright lawswere updated.

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Foreword


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Technology and its take up and use by individuals and business hastransformed how we run our lives and our businesses over the past sixtyyears. That rate of change is accelerating as we nd new uses for evermore capable technologies which can be applied to more areas of ourlives than imagined even ten years ago. Today we are learning and beingtrained to be capable members of the workforce using communicationtechnologies deployed by some of the nest universities in the world. Theincreasingly imaginative ways we will be using technology over this nextten years will shape every aspect of our lives, from dating, to work, toleisure, to being an engaged citizen.

We think nothing of accessing information from the internet via Googleor the Apps (applications) world and expect relevant information to bepresented in useful formats within seconds. Our interconnectedness istruly global and at the same time we wish to develop and preserve ourconnections with our friends and family and also with our history andour past. As Alvin Tofer prophesied back in the 1970s, we would createthe mechanisms to organise, control and connect our planet, whist at

the same time we as individuals would value our closest contacts and ourcommunities would become increasingly important to us.

This report sets out to raise some of the exciting opportunities and someof the key challenges that social networks, our society and businessesserving that society will face through the rapidly expanding use of thesepowerful social media tools.

David A. SmithChief Executive OfcerGlobal Futures and Foresight

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Introduction

As we make available more andmore content on line, were helpingto create a rich archive of amazingdata, opening up new and excitingways for individuals to expressthemselves and tell their own uniquestory. People will be able to ndtheir family history, document andbuild their own memories to recordthe stories of their lives, and whatsmore, keep it under safe lock andkey for future generations.

So ask yourself, what would bethe rst thing youd rush to save ifyour house was on re? If its yourprecious memories in the form ofphotographs and letters then isnt

it time you had a digital shoeboxfor them, safely tucked away online,so that you never have to makethat choice.

Chris van der Kuyl

Chief Executive Ofcerbrightsolid


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When mediachange, humanrelationships

change.

Michael Wesch,

media anthropologist1


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Explosive growth

Building on technologies that

surfaced in the 1970s and 1980s,social networks emerged in the lateyears of the 20th century. They havesince grown to encompass almost asixth of the global population, and inMay 2010 attracted more UK internettrafc than did search engines. Asa communication medium it is nowrmly established, with around two-thirds of Britons using it to keep incontact with friends and family.

Getting to grips with social networks

For years this growth failed todeliver many protable businessmodels, whilst organisations failedto capitalise on social networkspotential. However, innovative usesin the business world, private sphereand even governmental realm arenow appearing. A number of factors not least the need to discover newmarkets, enhance the bottom lineand save money - are becoming

increasingly important in the globallyconnected world that social networksare helping to foster. Howeverimpressive the impact of socialnetworks so far, we can only considerourselves at an early stage of theirprogression.

Individuals

People are engaging with socialnetworks both in and out of thehome, at whatever time of day suits

them and where allowed, in anycircumstances. Being in touch withthose people that matter to us is atthe heart of the human condition.Over two billion people are connectedin the top forty social networks today

and by 2020 we expect that up tove billion people around the worldwill be online and most will connect

via social networks.

Changing internet and how weconnect

In May, 2010, for the rst time inthe UK, there was more trafc acrosssocial networks than searches onthe internet. At the same time, wesaw a rapid growth in accessinginformation on the internet throughthe semi closed worlds of theapps (applications) facilitated, for

the most part, by the success ofApples iphones and ipad tablet. Thegovernment plans to facilitate accessto 2 mbps (million bits per second)broadband for everyone in the UKby 2015. By 2016 we are forecastingthat there will be twelve million1 gbps (thousand million bits persecond) lines in the UK - these linesare fty times faster!. What we canbe sure of is that the current form ofthe internet and how we use it is not

at the end of its evolution.

Gaming and virtual worlds

Massively Multiplayer Online Role-Playing Games (MMORPGs) attracthuge participation to their rich gameplaying worlds. The popular Worldof Warcraft game had over twelvemillion subscribers as at October2010. These games are very visualand there is huge engagementbetween the individuals who take

part. On the other hand socialnetworks have the capacity to involvehuge numbers of people in groupactivities but offer relatively littleopportunity for engagement. It is

Executive Summary

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clear that this will not remain thesame for long - as social networkoperators seek to inject game playing

and participation in increasinglyrealistic virtual worlds whereparticipants can explore, learn andeven ght together. When once wemight have phoned our friend, todaywe might text one another, tomorrowit will be common to go for awalk together in a virtual world,irrespective of where we might be inthe world. These changes are likelyto impact how we engage with ourfriends and family, our teachers andeven our government and transformthe engagement models in theprocess.

Crowdsourcing

Many existing business processeswill be challenged by the powerthat individuals have through theirconnected strength. Weve hardlyseen the start of this revolution. Thelast major shift caused by access tothe internet was, disintermediation,

the power of individuals with accessto services normally brokered to usvia agents. Now we buy airplanetickets, book holidays, buy car, life,pet and holiday insurance over theinternet and now prefer this tousing a human intermediary. Socialnetworks are allowing us to take part,as individuals, in large scale projectswhere we can contribute a small partto a large outsourced task.

Crowdpower

Social networks enable us to use thescale of our connected network tobulk buy or band together to leverageour collective size. For example; we

can even gather together to self-insure ourselves against all mannerof risks. No longer would we need

an insurer to gather a large groupto spread risk across. They maybe needed to provide the servicesaround managing the premiums,claims and reinsurance. How muchlower might the claims be inatedby and how many fewer fraudulentclaims might we see if we knew eachother and knew who was claiming.These village like environments canconnect us in joint endeavours in newways which will proliferate in thecoming decade.

Education

People intensive services areexpensive. Over the past sixty yearsautomation has driven out muchhuman activity from manual workand is now set to repeat this amongstprofessional and managerial roles. Inthe UK we are struggling to maintainoutdated models of deliveringeducation to our pupils and university

students. The future of masseducation will involve large-scale useof on-line resources over the internetand socialising over social networks.These facilities will replace much ofthe mass delivery of information tostudents, reserving the role of teacherand tutor for the more important,interpersonal and individual guidanceof their charges.

Older networkers

Government is seeking to reduceits operational costs and engagemore closely with its citizens. Socialnetworks are increasingly beingengaged to facilitate both of these

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aims. The size of the over 50 yearsof age population in the UK isgrowing rapidly. The over 85 years

of age population has doubled inthe past twenty ve years and is setto increase by 250% in just the nexttwenty years. It will be vital thatthese older citizens get on-line andengaged with the many resourcesthe internet has to offer, as quickly aspossible. The most vulnerable peoplein our society can be included inso many ways, if they can be shownhow to join and engage in socialnetworks.

Big Society

The coalition government is keen forpeople to become increasingly activeto help resolve some of the issueswe face in the UK. As individuals,we often feel our contribution cantmake a difference. Social networkshave the power to facilitate massengagement around issues we arepassionate about, as strangers seekto build a better world together.

Helping everyone in our society tohave access to the internet and byso doing, nd new relationships andengage in matters of concern to themwith like-minded people is vital if weare to develop a society where wefeel valued and included.

Ambient technology

By 2020 we expect to have over22 billion devices communicatingover the internet. As we will be

connected to it through manydevices, our use of technology tocommunicate effectively blends intoour surroundings. For example as wewalk down a street its possible for

our diary to connect with a bus stopand tell us to stop right there andwait 30 seconds for the right bus to

take us where we want to go. In thesame way will may be able to connectwith our friends, family and businessassociates in new ways that mighthave only happened by chance today.The issue will be one of privacy versusutility - which is likely to be one ofthe most discussed and argued overissues of the coming decade.

Business

Some organisations are now

discovering the power of facilitatingconnection between their staff andtheir business partners through socialnetwork technologies. Others aremore concerned about the potentialdistraction for staff and a fall inproductivity and yet others see socialnetworks as a threat to informationsecurity. As with all new technologies,if they can be called that still, thereare threats to the status-quo but welearn to harness the benets of these

new tools and minimise their risksand by so doing realise their truedisruptive potential.

Productivity

Social media, as we might collectivelydescribe these social connectiontools, offers a real opportunity tofacilitate improved communicationand increased productivity, across ourenterprises. Increasingly organisationsare fragmented and distributed, often

across wide geographies and nowthat we are working in a more mobilefashion we need to harness socialnetworks to allow groups to connectin both an organised and viral way.

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Recent studies are indicating thatallowing staff access to their personalsocial networks at work can increase

their overall productivity and thatthose who are allowed to use thesetools to do their job are less likelyto leave.

Security

Facilitating personal access certainlyshows employees that they aretrusted to manage their time properlyand also that they can be trusted notto divulge proprietary informationto outsiders. If we allow people

to send e-mails with attachments,then we should also allow peoplewho use social media, as theirpreferred communications method,to use these tools. The job at handis to protect sensitive data frommoving inappropriately, not limit thecommunication channels we use.After all, there will be many new andcurrently unknown communicationstechnologies employed by businessin the coming years. Rather than

fearing new technologies, we need tobecome quickly condent in their useand exploit them to our advantage.

Innovation

As open-source innovation and co-creation become familiar meansfor rms to innovate their productsand service offerings the role ofsocial media becomes more critical.Firms that have embraced thesecollaborative ways of surfacing new

ideas, understand that the greaterthe size and diversity of input thehigher the likelihood is of imaginativeand break-through innovationhappening. Social networks provide

the transport layer on which newideas can ow into the organisation.Procter and Gamble built a network

of over three million contributors totheir product innovation process andmoved from one of the lowest to oneof the highest new product successrates in their industry.

Mobile

Our workforce and consumers areall living in a more mobile andspontaneous environment today,frequently facilitated throughtechnology. Smartphone sales are

rapidly replacing normal mobilephone sales. At the same timemobile broadband coverage andcapability is increasing rapidly. Laptopcomputers, notebooks, netbooks,mobile phones, smart phones andnow tablets - popularised throughthe explosive take-up of the Appleipad - are facilitating our 24/7 mobileworld. The challenge for businessis to harness these technologies foradvantage.

New business models

Social networks, cloud computing(where the computing power anddata storage takes place on theinternet), ambient technology(pervasive technology thats allaround us that knows who weare and where we are - if we letit), mobile and combinations ofinformation coming together toprovide new products and services

(mash-ups) are changing consumersexpectations of service and changingthe business models organisationsdeploy. These models have thecapacity to transform how we

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communicate, sell and connect withour staff and customers in the future.

Data explosion

So how will we cope with all thisinformation about where peopleare, what they are doing, in whatmode (business or leisure) and whatthey are saying across their socialnetworks and through a variety oftechnologies. We will be recordingthe data we send - words, pictures,video, sounds etc, but we willalso capture our mood our facialexpression and tone of voice, where

we are and maybe even who or whatis happening around us - our context.Successful companies will know howto manage this information to theiradvantage.

The question today is; Where willthe storage capacity come from andwho will own the information? Dataanalytics will need to move on rapidlyto keep pace and we will need toconsider how long this information

should persist and who should haveaccess to it. We will also need toconsider new forms of copyright andbusiness models that reward moreopen behaviours in the future as weseek to share this rich data betweenindividuals and organisations.

New stakeholders

As we are very aware, our customersare increasingly listening to otherpeoples opinions about our

organisations performance andour products and services. Tweets,social networks, blogs, advisory sites,buying portals and e-mails are allways that people are sharing theiropinions about brands, for good or

ill and can have a major impact onthe perception of their brand andtherefore its value. Its now time to

consider these social networkers thenext major stakeholders in our rms.No longer are they the concern of themarketing and IT departments butnow need to be considered in thedevelopment and implementationof the organisations strategy at thehighest level.

Where next?

It is generally agreed that the nextstep of progression is towards mobile

social networking. Rather than justusing a mobile interface, new GPSand geo-location systems have thepotential to radically enhance thewealth of data, generated by socialnetworks with tomorrows industrywinners emerging from those whobetter adapt their business modelsto it.

The expansion of technology andsocial networks to effectively blendinto our surroundings seems quitelikely which if combined withmore mobile applications, has thepotential to revolutionise humanbehaviour, commerce, industryand government. The explosionof data this will generate will betruly transformational should theability of analytics keep pace. Thisnew platform of data would heraldthe dawn of a new, more efcienteconomy, better able to cope withfuture challenges of an ageingpopulation, economic problems and

declining corporate prot. The adventof social networks has left the worldbetter off, yet in many ways thebenets have only just started tobe realised.

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An estimated two-thirds of Britons usesocial networks more

than face-to-face tokeep in touch withfriends and family10.


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Social networks in themselves arenot new to us, but social networks,in the sense most people refer to

them today, represent an enhanced,more efcient and more effectiveversion of what previously occurredin the ofine world. Throughoutthis paper the term is used to referto the electronic form popularisedby MySpace, Facebook LinkedIn,ecademy, Friends Reunited, and manyothers.

It was with the advent of the 21stcentury that saw the explosion ofUK social networking. Facebook,launched in February 2004, now hasthe largest network both in the UKand across the globe and FriendsReunited launched the rst socialnetwork of its type in the UK inOctober 2000. Impressive growthwas recorded when social networksexpanded their share of total UKinternet visits more than threefoldbetween November 2005 andOctober 20071.

In May 2010, social networksattracted more UK online trafc thansearch engines for the rst time.

Social network site trafc increased to11.8% of all total UK trafc up from10% from May 2009, whilst searchengine trafc declined from 12%to 11.3% 3. Friends Reunited alonereached 1 in 4 UK adults in 2009,tallying over 3 million unique visitorseach month and seeing a millionmessages sent between memberseach month.4

Trafc alone, however, doesntconvey the importance that onlinesocial networks are assuming. Whenactual time spent on the internet isconsidered, they account for 23%of total time. That equates to 13minutes and 36 seconds of every houronline, notes Nielsen. This representsa 159% increase from time spent onsocial networks back in April 20075.6

Not surprisingly given the highpercentage of online time spent onsocial networks by people, accessis an increasingly important issuefor businesses to address. As much

as 6% of UK employees admit tospending an hour or more every dayusing social networks at work fornon-professional use. The associateddecline in productivity could costBritish business as much as 14

1. History of social networksin the digital age

2.1 The present stateof social networks

Taking time outon social networksprovided workers witha mental break thatultimately led to 9%productivity increase.

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billion a year7. Such gures may beused as justication for restrictingaccess, but equal evidence exists

that this may be premature. An April2009 Australian study found thattaking time out on social networksprovided workers with a mentalbreak that ultimately led to 9%productivity increase, to say nothingof the potential benets of usingprofessional oriented sites such asLinkedIn.

Suspicion, as to the benets ofallowing employees access to socialnetworks at work, could be due,in part, to the reticence of manyrms to actually realise the broaderbenets of social networking. Thetop 50 companies in the 2009Deloitte Fast Tech, a list of the fastestgrowing technology companies inthe UK, dont necessarily use socialnetworking well, though 90% havea presence on two or more socialnetworks8. However . The mostsuccessful brands will be those thatembrace and learn to harness social

media rather than underestimate orght against its inuence9.

Despite the potential and in somecases, realised potential for manyorganisations, social networkingin 2010 still remains most popularamongst individuals. An estimatedtwo-thirds of Britons use socialnetworks more than face-to-face,to keep in touch with friends andfamily10. Increased familiarity is alsochanging behaviour an estimated

80% of adults with social networkproles are likely to restrict access toothers, compared to 48% in 200711.


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B2C (Business to Consumer) 12

Despite the reticence and lack of

know-how, in many companiesattempts to get to grip with themedium, examples abound ofsuccessful social network and mediaintegration.

Dominos Pizza reported a 29%increase in pre-tax prots to 17.5min July 2010, largely owing to anincrease in e-commerce. The companynotes that this area had seen 61.4%growth in the same period andthat it now accounted for nearly

a third (32.7%) of all UK deliveredsales. One of its recent (July 2010)promotions encouraged Dominospatrons to check-in using GPS ontheir phones - at their locations, eventhough none of them offer dine-in services. The rst effect was toincrease foot trafc, which eliminatedcosts associated with delivery, whilsta viral effect was created when auser would check-in at a Dominoslocation, sharing their actual location

with their friends, exposing them tothe Dominos brand.13.

B2B (Business to Business)

Social networking is essentially acommunications tool, and one thatcan be just as effective for businessto employ internally as it can forexternal marketing or research anddevelopment (R&D).

In 2008, Cognizant Technology

Solutions, a US-listed outsourcingcompany, introduced a new internalcommunications system based onthe principles of social networkingsites. Within months most of its

under 30-year-olds who fall into theso-called millennial generation,were migrating to the new system

en masse.14

The systems popularityequates to a lower attrition rateamongst active users of thesoftware. It is about one third ofthe level of staff who seldom useit. Internal use is also leading to anew business proposition. Clientsare increasingly asking them forhelp rst to understand the trendand then to write and implementsoftware, incorporating it into theirbusinesses15.Nor is Cognizant unique; Infosys, aleading technology service provider,has set up its own collaborationsoftware, iEngage. This socialnetwork platform enables easycollaboration between engineerswhen they are writing programmes.Given the international nature ofbusiness, this also enables virtualnetworks to coalesce regardless oflocation, allowing greater R&D inputas well as potentially reducing theneed for business travel.

P2P (Person to Person/Peer toPeer)16

Social networks and communities arealso innovating at the peer to peerlevel. Online investor communitiesexist, such as Investorvillageand SocialPicks that empower usersto cross-compare their investmentportfolios performance to theirpeers, as well as professional analystsand the like. SocialPicks websiteclaims, it is Social Networking forSerious Investors.

2.2. Innovative uses of socialnetworks in todays society

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Crowdsource-generated nancialcontent is also available throughnetworks such as Tipd and Smarty

Pig, an innovative online bank thatuses viral networking as a platform.Users create a free Smarty Pigaccount and set specic saving goals(e.g. 3,000 holiday fund by August30). Smarty Pig then calculates howmuch users should contribute, eachperiod, to reach your goal. Theinteresting part is that it then allowsusers to openly share their savinggoals in social networks with familymembers and friends, who can makecontributions towards their goals17.

Social gaming is also growingrapidly. Colloquially, games on socialnetworking sites are called socialgames. Some differing denitionsinclude: Multiplayer games thatutilise the social graph, i.e. a playerssocial connections, as part of thegame. Examples: Parking Wars,PackRatGames in which the maingame play involves socialising orsocial activities like chatting, trading,

or irting. Examples: YoVille, PetSociety. Turn-based games that areplayed within a social context or withfriends. Examples: Texas HoldemPoker, Scrabble. Competitive casualgames that include friends-onlyleader boards. Examples: Who Hasthe Biggest Brain? Word ChallengeThese games have the advantage ofhaving access to information aboutthe player in order to target the gameto their needs and preferences and it

also leverages a persons connectionsgiving instant access to potentialgame players.18

G2C (Government to Citizen) 19

The UK Coalition government set

out The Spending Challenge in mid2010 in which it asked membersof the public to help shape theway government works. As itsname implies, it acted as a forumfor suggestions on what servicesand programmes could be cut, andhow. The website noted (retrievedSeptember 1st 2010) that over thepast month, members of the publicsubmitted more than 45,000 ideasand registered over 250,000 votes forideas put forward by peers that theyliked.

The website states that a numberof ideas may have the potential todeliver efciencies over the longerterm, so we will continue to reviewthese over the next few months.Critics noted the propensity forbigoted ideas to appear and somenoted that simply asking the publicwhat they think wont necessarilyachieve wide participation and

discussion. However there can be nodoubt that The Spending Challengeexperience will be improved uponin an era where government isincreasingly pressed to provide moreservice for less cost.20.

Indeed, at the heart of the presentgovernments Big Society initiative,is the desire to stir the UK populationto action to help address some of thenations challenges. Social networks

will be at the heart of enabling like-minded citizens to act collectively andtherefore with increased impact.


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1. Broadband penetration

In the UK, two thirds of householdsnow have an internet connection21.Despite the previous governmentsbroadband promise, the CultureSecretary Jeremy Hunt said it was notpractical to meet Labours previouspledge to get rural areas hooked upto a minimum of 2Mbps (million bitsper second) broadband by 201222.

Due to a shortage of funds, the2Mbps minimum wont happen until2015. However, some forecasters arepredicting that by 2016 there will beover 12 million superfast broadbandconnections (400mbps to 2 giga bps(thousand million bits per second))in the UK.23 Increased broadbandpenetration suggests there is plentyof room to grow social networks asmore and more people access theinternet at faster speeds.

2. Rise of mobile technologies

UK citizens are spending more timethan ever connected to the internet,partially due to the growth ofmobile internet browsing throughSmartphones (mobile phones thatact like computers) and more recentlytablets (Highly mobile larger screentouch screen computers) like Applesipad.. Smartphone ownership in the

UK grew by 81% in the 12 monthsto May 2010, from 7.2 million to12.8 million (or around a quarter ofthe population). Time spent on theinternet on the go has now risen to1.3 hours a month, and has causeda 240% increase in data sent overmobile networks. Another factor is arise in longer 24-month mobile phonecontracts to 63% of all new contractsin the second quarter of 2010,compared to just 3% in the same

period in 200824

. With Smartphonehandset prices already below 150and set to halve in the next one totwo years, we should expect stronggrowth in their take-up and use.At the turn of the year we will see

3.1. Key trends shaping the futureof social networks

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By 2016 there will be

over 12 million superfast

broadband connections(400mbps to 2 giga bps

(thousand million bits

per second) in the UK.23


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a plethora of copy-cat, ipad-like,devices hit the streets which will onlyserve to accelerate our demand for

mobile high-speed connections.

3. Ambient technology/internetof things

In 2009 the Internet had around 575million host computers. Right now,the number of web-enabled devicessits at around 5 billion26. By 2020it is forecast there will be 22 billionweb-connected devices in the world.When this happens we will essentially

be living with ambient intelligence

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- electronic environments that aresensitive and responsive to thepresence of people. This denotesembedding intelligence and anIP address in everything from therefrigerator to the interior of ofcebuildings to public places. DeutscheTelekom for one is targeting 1bn insales from intelligent networks by201528, a goal partially facilitated byincreasing urbanisation.

By 2020 our environment will knowwhere we are, why we are there

and who we might be meeting andwhy (if we use electronic diaries)and whats around us that might

be of interest to us. Imagine beingmade aware that a distant relative issitting on the table next to you in thecoffee shop youre in or that a closefriend is just fty yards away fromwhere you are. It raises the questionof what information you want to bepresented with and what degree ofprivacy you want for yourself.

4. 24/7lifestyle 29

A recent study found that as many as73% considered a mobile phone as anessential gadget to take with them onholiday, 87% actually used a mobilewhilst away and nearly half (46%)of them relied on text messages inorder to keep in touch with friendsand family back home30.

No longer does going on holidaymean getting away from it all either,as more than half of those in thesurvey (59%) felt the need to accessthe internet whilst away and usedthe hotels computer or a nearby

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internet caf to do so. A 24/7 lifestyleindicates mass potential for alwayson social networking. The possibilityof effective mobile social networkingalso suggests that the percentagesnoted above are likely to rise.

5. Data expansion

The falling costs and increasingpenetration of technology arecombining to provide a massive

increase in data and in data analysispossibilities. Diseases can now bemapped, crime predicted and trendsanalysed. Difculties have arisen,and may continue to rise as datageneration accelerates. Data securityand privacy are being adverselyaffected, as is the ability to accessand retrieve some stored information.The sheer weight of data is alsoimplicated in obscuring otherwisevisible trends, as shown by themodels utilised by those at the heart

of the global nancial crisis.

IDC, a global provider of marketintelligence, notes that there will bearound 1750 exabytes (an exabyte

is a million terabytes or a billiongigabytes) of global informationcreated by 2011, but availablestorage will only be around 800-850 exabytes31. It is quite likely thatuntil the gap can be closed, socialnetworks in general will be unable toevolve both in terms of their businessmodel and in terms of the utility they

provide for their users.

6. The future of the net: web v

apps

We are witnessing one of the mostimportant shifts in the digital world32,where the web is being discarded infavour of semi-closed platforms. TheiPhone model of mobile computingis one major factor and the world ofapps is being increasingly preferredby consumers to the webs searchand HTML technology. Not only isthe app based internet more direct

and efcient than the web based net,but it is also proving easier forcompanies to make money on theseplatforms. In short the web does notrepresent the pinnacle of the digitalrevolution.

17

The web doesnot represent thepinnacle of thedigital revolution.

Privacy versus utility

- to receive pertinent,useful offers to help you

achieve your goals versus

our desire for anonymity,

security and privacy.


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7. Geo-spatial and augmentedreality technologies

Over 12 million people in the UKalready have devices that knowwhere they are, most of which alsohave a camera and high qualityvideo screen. Today we may only beusing them to gain discount off ourmeals when out, using sites suchas Vouchercloud but tomorrowwe will be engaging in a richlyintegrated, geo-positioned worldwhere tailored offers can come to usas a consequence of the ideas and

thoughts we might have expressed inconversations in our social networks.Again the issue is one of privacyversus utility - to receive pertinent,useful offers to help you achieve yourgoals versus our desire for anonymity,security and privacy.

A survey of hundreds of internetleaders, activists and analysts foundthat33 by 2020 it is expected thatarticial and virtual reality will havebecome more embedded in everyday

life. 55% of surveyed experts saidthey mostly agree with the statementthat in 2020, many lives are touchedby the use of augmented reality orspent interacting in articial spaces.If augmented reality is embeddedand can rely on some mobile GPStype technology, social networkscould evolve into an even more usefulbusiness tool, and an ever morepervasive social one.

8. New era of masscommunication

Todays internet has 1.73 billionusers. This compares with a world

population of 6.7 billion people. By2020 global internet access will haverisen to nearly 5 billion users, but its

use is likely to have evolved34

. Notonly is access growing but utility ofthe internet is deepening at a fasterrate, so that by 2012 the internet willbe 75 times its size in 2000 with over400 times the trafc, mostly due tothe rise of online video35.

9. New business era

Emerging from the deepestrecession since the 1930s, businessis looking to innovate, cut costsand increase the effectiveness ofits communications and marketingprocesses. Social networkingtechnologies, web mashups (anapplication that combines contentand functionality from a variety ofsources) and cloud computing (thatswhereyour business systems runon the internet, not your companyservers) are amongst the ten mostdisruptive technologies. They willshape the information technology

landscape, and hence the businesslandscape over the next ve years36.One possible outcome is that ... thebusiness organisation of the futurewill be virtual37.

A 2010 study by BT global servicesfound that 65% of businessesagreed virtual working wouldhelp their people achieve a betterwork/life balance and more thanhalf (55%) felt it would ultimatelyresult in happier staff, and thissuggests that businesses are slowlychanging their views on essentiallydevolving operators out of theofce space. This social benet isin conjunction with proven tangible

By 2020 globalinternet access willhave risen to nearly

5 billion users, butits use is likelyto have evolved34.

By 2020 it is expectedthat articial andvirtual reality will

have becomemore embeddedin everyday life.


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gains such as those experienced byBT. The company reckons its exibleworkforce saved it 500m in buildingcosts and 100,000 tonnes of CO2,as well as contributing to a 30% risein productivity since implementingexible and virtual workingpractices.38

10. Trust

The social landscape has changed andthe relationship between brands andconsumer has fundamentally alteredbecause of the way consumersconnect. So much inuence (andinsight) is now in the hands (andtweets, posts, votes and updates)of the consumer. Consumers arentalways paying attention to marketingmessages but they are payingattention to each other. More than40% of consumers go online to checkreviews and consumer feedback

before purchasing consumerelectronics. 60% of those goingonline have visited a social network,with half going back every day.23% of social network users expect

companies to listen and respond towhat is said online39

11. Education

Roughly 100,000 of the 12 millionhigh-school-age students in theUS attended 438 online schoolsfull-time in 200940. Some analyststhink explosive growth may occurrelatively quickly, with one estimate

suggesting this gure may rise to 50%of all courses by 201941. This wouldcorrelate to the expansion of wirelessbroadband, which will probably reach3-4 out of 5 people on the globe by2015-201842. Increased connectivitywill not only facilitate greater exibilitywith regards to the physical localein which learning occurs, but alsohow the learning occurs and fromwhich information source.Several topuniversities in the UK Universities of

Oxford and London and of course, theOpen University offer online courses.The social context in which higherlearning has traditionally taken placeis engendered through social networksfor enrolled students.

19

The fastest growingsector of the

population is the over50s age group whichis also the fastestgrowing group inour society for usingsocial media.


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With older users rapidlygetting online and

getting connected viasocial networks, livinglonger and owningover 80% of the UKspersonal nancialassets this groupsexpectations will needto be increasinglyconsidered.

20

12. Older social networkers

The fastest growing sector of the

population is the over 50s age groupwhich is also the fastest growinggroup in our society for using socialmedia. In August a Pew Internetreport showed that the group aged55-64 grew by 88% and aged 65 andabove even grew 100%, in the use ofsocial networks.

According to a poll carried out byAge UK, over six million people inthis age bracket who have never

gone online.43

The Governments newinitiative, Get Digital, will help over620,000 older citizens get online bythe end of March 2011.

Lord McKenzie, said:Technology has

changed so fast that it has left manyover 50s feeling left behind. Thisprogramme is about bridging the

digital divide. The internet will makeit easier for people to keep in touchwith their families, shop online andaccess a wide range of services.

Martha Lane Fox, Champion forDigital Inclusion, commented: Morethan 10 million adults across theUK have never used the internet,and worryingly 4 million of thisgroup are also socially excluded. Ofthis group 39% are over the age of65 and missing out on the manyopportunities and cost efcienciesthat the web has to offer.44

With older users rapidly gettingonline and getting connectedvia social networks, living longerand owning over 80% of theUKs personal nancial assets thisgroups expectations will need to beincreasingly considered.

13. Gaming and Virtual Reality

Revenues from games played onsocial networks reached $639m(426m) in 2009, up from just$76m (50.7m) the year before. Themarket remains dominated by thedistribution power and massive userbase of Facebook, but this marketis by no means a one networkopportunity. Monthly, active users ofgames reached over 500 million at

the end of 2009, from just 60m in2008. The USA is the largest marketfor social games (games playedacross social networks), way aheadof second placed UK. Much of the


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recent growth in the PC casual gamesmarket is now being driven by social

games (games played across socialnetworks). A large majority of socialgames revenues are generated bysales of virtual currency and goodsthat are spent on and in games.The market is forecast to be worth$1.5bn (1bn) in 2014 to more thandouble over ve years.45

Virtual worlds have long offeredpeople the opportunity to exploreand build online worlds wherethey can choose to play, ght or live

together in harmony or at war. TheseMassive Multi-player Online Realitygames (MMORGs) include Worldof Warcraft, the Sims and SecondLife amongst the dozens that existtoday. As graphics improve andspeech and video connect with theseenvironments and social networksinclude more game-play we willincreasingly see these virtual-worldsbecome more familiar to individualsand relevant to business. Already

IBM uses them for recruitment andmeetings, CISCO for meetings and tohost music concerts. Their use is only

as limited by our imagination and ourability to make money from them.

Social networks have the user basewithout generally having the toolsfor increased interaction amongstmembers, games and virtual worlds,on the other hand, have the capacityfor greater interaction but arewithout the user base. We shouldtherefore expect that social networkswill move into the gaming and virtualworld space aggressively over thenext ve years particularly as photo-

realistic avatars (moving characters invirtual worlds) become the norm. 46

Revenues from games

played on socialnetworks reached$639m (426m) in2009, up from just$76m (50.7m) theyear before.

21

Much of the recentgrowth in the PC casual

games market is nowbeing driven by socialgames (games playedacross social networks).


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The Race Online 2012government initiativeseeks to encourage

and facilitate the up-to10 million people inthe UK without internetaccess.

14. Government intervention

The Race Online 2012 government

initiative seeks to encourage andfacilitate the up-to 10 million peoplein the UK without access to theinternet. to get online. As DavidCameron, the Prime Minister, explainsIn the internet age, we need tomake sure that people arent beingleft behind as more and more servicesand business move online. A futureimportant differentiator betweenthe haves and have-nots in oursociety will be access the internet and

all that it offers.

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Social networking is to the currentera what online access was just 20years ago47, in so far as how we

share and access information. Ifsocial networking does indeed proveas transformative as the internetitself, then many future featuresof such networks are two or threeadvances away from us and hence atpresent, unknowable. However, thereare various traits emerging that mayprovide some idea how the use ofsocial networks will evolve.

Undoubtedly , location-basedmobile networks are the next wave ofsocial networks48. A location basedmobile social network will requirepresence, location and contextualinformation about the user. Thiswill require GPS or triangulationtechnology as well as informationregarding your mode at work,relaxing etc, both for the user andthose around them49. Featuressuch as SpotMe already exist in themeetings industry that allows, at abasic level, the ability to sort and

browse through people in closevicinity and their purpose for beingat, for example, a given trade showor conference. Thus the technologyis, in many ways, already in place.The issue remains however of one ofprivacy and security versus utility andexperience.

Such a move towards a moremobile based social network wouldimpact various sectors. One facetimpacting all sectors would be acoming explosion of data. Howto take advantage of this data,whilst respecting privacy issues, willdepend much on the future of dataanalysis. Large data sets, especially

those revealing real consumer lives,will generate a fantastically richopportunity for data analysis. Indeed,

the ability of data analysis to scaleeffectively, and to generate businessopportunities is perhaps the keydeterminant in the usefulness offuture social networks. Such analysiscould lead to improved personalrecommendations at P2P, B2B andB2C levels as well as the detectionof opportunities for innovation,pattern recognition and problem pre-emption.50

Such potential is reected in the

forecast that over 600 million peoplewill use their phones to tap intosocial networks by 2013; a more-than-fourfold increase on 2009s140 million51. Reduced mobile priceshave led to small handheld mobilesbecoming the device of choice foraccessing some sites in Asia. Mixi,one of Japans largest social networkswith 18 million members, says thatthe vast majority of its trafc nowcomes from mobile customers who

check in to get updates four or vetimes a day. 52

3.2 Tomorrows consumer

23

600 million peoplewill use their phones

to tap into socialnetworks by 2013;a more-than-fourfoldincrease on 2009s140 million50.


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Whether mobile or not, online communities will be themost important category of non-

traditional stakeholder for companiesin ve years time. Despite this,many companies are leaving itto public relations or marketingdepartments instead of incorporatingnew stakeholders into their strategicthinking at board level53.

One key obstacle that will need tobe overcome is the fear of a loss ofcontrol. One commentator from anEconomist Intelligence Unit reportnoted that everything will getout there in the end. This pointis reinforced from a 2010 report,which concluded that companies arespending vast sums protectingtheir intellectual property, yetbetter cost effectiveness would beachieved by simply distributing theinformation54. We will need to seenew business models develop whichwill increasingly reward organisationsfor more open behaviour.

B2C (Business to Consumer)

In February 2010 it was reportedthat Unilever is to integrate socialmedia into product developmentand insight55, following trials withbrands in the UK and US. Gaininguseful insight of consumer opinions isthe objective, yet issues surroundingreliability of such input hasencouraged Unilever to create invite-only communities.

David Cousino, consumer marketinginsights global category directorat Unilever notes that even if abrand doesnt want to engage with

consumers on that level, it will beforced to. To take advantage ofsocial networks and social media

however, a genuine desire forconversation and an acceptance oflosing a large degree of control overthe process are necessary. Initially,Unilever used co-creation agencyFaces online youth communityHeadBox to source a small teamfrom around the world who createdthe idea for the two-part Lynx Twistfragrance. The online communitywas then used to generate additionalideas and discussion before itdeveloped the best forthcomingideas. Unilever now plans to developthis method in a bespoke fashionacross its product range in otherconsumer sectors.

The prospects of co-creation area major benet resulting frombusiness-to-consumer socialnetworks if handled correctly. Thereis, undoubtedly, further progress tobe made in this area. It is clear thatsocial media, far from being another

channel, has and, will continue to,drastically alter the way consumersinteract with brands.

E-Government and the BigSociety

Public service delivery is the at theheart of the Big Society concept,and commentators note thatsocial networks can play a bigrole both in creating contexts

for more sustainable solutions,and in supporting the distributedparticipation that can give peoplea role in delivering them. It iswidely thought that any effort must

Online communitieswill be the most

important categoryof non-traditionalstakeholder forcompanies in ve yearstime.

It is clear that socialmedia, far from beinganother channel, hasand, will continue to,drastically alter theway consumers interactwith brands.

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avoid the traditional input-outputmanagement thinking as suchnetworks are complex and adaptive.

There are examples from whichthe Big Society can learn. Oneprominent organisation using socialnetworks for social provision is theUK organisation, Participle. Theorganisation utilises a mix of servicedesign thinking, creativity and socialnetwork thinking all of which addup to a culture that welcomes abroader set of ideas about problemsolving - not a centralised, onesolution ts all approach that wehave seen over the last 20 years56.

As part of its Southwark Circleproject, Participle has pioneeredthe use of real-world social networksamong older people to give thembetter access to simple assistance thatyounger, more connected people takefor granted, whilst at the same time

creating new opportunities for socialinteraction, friendships and meet ups.Such simple, peer-to-peer services arenot only cheaper than individually-provisioned services, but they alsoact at a more human level that helps

prevent isolation and the problemsthat creates57.

Educational networking

Social networking sites, whenreduced to their core components,are an aggregation of a set of Web2.0 building blocks. The rst sitesthat were constructed using Web 2.0building blocks were often casino-like, - opportunistic and chancy- leading to a sometimes negativepublic perception as a waste oftime. It is noted that Theres noreason why the same building blocksthat built those social networkingcasinos cant be used to createschools, libraries, meeting halls, orteachers lounges, which is exactlywhat were starting to see happentoday.

Educational networking has potentialacross the whole provision ofeducation, on both the supply anddemand sides. From the studentsperspective, lifelong learning withoutcareer or life disruption is possible,often at a lower overall cost than on-

25

Educational networkinghas potential across

the whole provisionof education, onboth the supplyand demand sides.


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site learning. Educators meanwhileare better able to meet the demandsfor customised approaches to

meet their students specic needsas well as participate efcientlyin professional developmentopportunities. LearnCentral is onesuch site that is aiming to providesuch tools for educators. Theirwebsite states that LearnCentralis a new social learning network foreducationa free, open environment(that)represents the next logicalstep of combining asynchronoussocial networking and the ability tostore, organise, and nd educationalresources using live, online meetingand collaboration59, options. Whilestill in its early stages, LearnCentralhas the potential to make asignicant historical difference inhow educators work together forprofessional development in theirown careers.

Bill Gates has noted that GreatEducators have always known thatlearning is not something thats

limited to the classrooms, or thatshould be forcibly undertakenunder the supervision of teachers60.With social networks providing theplatform for both the educationalprocess and a basis for interaction,the technology is already in place foreducational networking development.

Projects abound where importantlibraries of content are being digitisedand made available on-line. A recentand excellent example is the decisionto digitise and give access onlineto the Newspapers held by theBritish Library. These sort of projectsgenerate access to the content thatthe education system,

at all levels, relies on. Their availabilityonline further strengthens the casefor decentralised and networked

learning.

A recent study found that while 70%of UK universities give postgraduatesthe opportunity to study off campus,only 40% offer distance learningfor undergraduates61. Furthermore,UCAS, the university admissionsservice, reported that applications toundergraduate courses at universitiesin the UK grew to 660,000 thisyear, up 11% from last year andthat many universities also declaredthemselves full before A-levelresults were even announced. SocialNetworks are therefore likely tobecome increasingly important in UKeducation as more students embarkon distributed learning but still desirethe social interaction that traditional,campus based, higher educationprovides.

Social studies

The new role of social networksis still being gured out. Now inUK academia, social networks alsoare being promoted as agents ofsocial change62. At De MontfortUniversity in Leicester, Professor SueThomas has been running a projectdesigned to show how socialmedia such as Twitter and Facebookcan be used to connect the citysdisparate and diverse communities

and networks. Leicester has auniquely diverse population withsome 40% of the citys 300,000residents belonging to ethnicminority groups, and it is expectedto become Europes rst white

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minority city by 2015. Deploying thepower, ubiquity, and modishness ofsocial networks to bridge and break

down the barriers between ethniccommunities, is an emerging areaof study.

Whilst social networks are nopanacea for every social, politicalor economic problem, the generaltenets of increased interaction andcollaboration, data generation andanalysis, and ubiquity suggests thatsocial networks will be used byalmost all of tomorrows consumers,whether directly or indirectly in manyof tomorrows products and services.

Gaming and Virtual worlds

We can expect that more socialnetworks will introduce gaming tofacilitate increased engagementbetween members across theirnetworks, and even to extend theirnetworks. At the same time thevirtual worlds, as pioneered bysuch sites as Second Life in 2003,are set to move towards increasinginterconnectedness of their worlds.The number of gamers, the amountthey spend and the time they spendtaking part in games and in engagingwith virtual worlds is set to growrapidly to 2020 and will be facilitatedthrough the increasing availabilityof broadband connections and theconvenience of mobile technologies.

27

Virtual worlds, aspioneered by suchsites as Second Life in2003, are set to movetowards increasing

interconnectednessof their worlds.


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Technological progress

In the future, we will be able to

download information to a singlesmall, but hugely powerful, device.It will integrate everything wecould possibly need - phone, creditcard, music player, media player,high-speed internet access, hi-rescamera, G3, GPS and so forth - intoone unit. Given the trend towardsembedding the internet into items,and by implication, social networks, itis likely that these devices will act asmobile portals for them. The keys totechnological progress undoubtedlylie in the ease of use and the valueit adds. The latter implies a degreeof customisation and an increasingproportion of added value forcontemporary people-orientedbusiness, lies in its ability to adapt tothe needs of individual consumers63.This will mean the devices we useto connect to social networks andeven the networks themselves willneed to possess enough intelligenceto learn by experience and be able

to customise themselves to theway the individual wants to usethem. In many ways the emergenttechnologies are already here -mobile phones are now sophisticatedenough to collect and analysedata on personal behaviour, andresearchers are developing techniquesthat allow them to effectively sortthrough such information64

One possible result is the evolutionof the avatar/homepage used torepresent the social network user.A touchable holograph displayhas already been developed at theUniversity of Tokyo, that adds tactilefeedback to 3D images65 which gives

us a glimpse into the future of howwe might be interacting with oursocial media soon.

Business models and revenuestreams

U.S social network ad spendingincreased 68% from $4 billion(2.53 billion) in 2009 to $7.5 billion(4.75 billion) in 2010, it is predictedto grow every year to about $38billion (24 billion) in 2015. The 2015gure will represent approximatelya third of all U.S. online marketing

spending.

66

For some time the biggestquestion was where this revenuewould actually come from and howmonetising the product would work.

To achieve this, social networks mustovercome the URL strategy, orUbiquity First Revenue Later method.

It is suggested that any innovation inmonetising social networks is limitedby the ability of analytics to keeppace. This explains why the bread

and butter business model of displayand banner ads will remain a part ofthe business model for many years.67.Since the potential for continuedgrowth within social networks stillexists, this precludes any drop inrevenue from this source, but mostprobably further innovation in otherareas will be needed to meet thepredicted target.

One emerging revenue stream isto brand certain elements within

an application.For example,VentureDig, a micro-blogging

platform for entrepreneurs, notesthat LivingSocial is an applicationwhere users can make a list of their

3.3 The evolution of social networks

28

The keys totechnological progressundoubtedly lie in the

ease of use and thevalue it adds.


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favourite things. Big brands, likePorsche, may want to get in frontof their audience and have users

speak about their brand in a viral,social networking space. Therefore,Porsche will pay LivingSocial for eachexposure (i.e. being on a newsfeed)to their audience.68Marketershave long known that personalrecommendations are hugelyimportant in purchase decisions.Social networks are harnessingtechnology to accelerate this processby, for example, automaticallyalerting a persons friends when heor she signs up to become the fanof a particular brand or product ona site. A similar model to brandingcertain elements is to run a freemiumtype service whereby the basic serviceis free but upgrades require a paidsubscription. LinkedIn has managedto implement this model successfullyand is said to have annual revenuesof over $100 million (67m).

One recently established revenuestream is through virtual currency;

indeed in 2008 Tencent, whichis listed on the Hong Kong StockExchange, reported revenues of justover $1 billion (667m), with $720m(480m) coming from online gamingand sales of items such as digitalswords and other virtual goods69. Thisemerging model has become knownas the Asian model. Similarly virtualgifts surpassed $1 billion (667m) forUS users in 2009.

It is likely that social networking

will broaden to include other typesof networking too. For example, inMarch 2010, a new application waslaunched on Facebook, which allowsfriends to transfer money to one

another. Currently, the application,called Buxter, can only be usedfor sums below 45 and for Buxter

account-holders. It can be expectedthat the sums will increase and use ofthe application will become easier inthe future70.

Business models revolving around theanalysis of data, such as Twitter feeds,generated within social networksare also possible although progresscould well be blocked by privacyissues. Given that the nature of socialnetworks will continue to evolveand that the coming data explosionwill create whole new platforms foranalysis, it is quite possible that weare only at the beginning of an era ofsocial network monetisation. Thereis a pretty strong argument to bemade that social networks are worthmore than they are being given creditfor71.

From the web to the street

Wearable devices - for example a

backpack or visor that can displaychosen images and feeds - offeringevent experiences will become morecommon by 201272.. Whilst this isenvisaged for the event industry, thetechnology would only require a bitof alteration to become applicablefor wider public settings. Withouta doubt, location-based mobilenetworks are the next wave of socialnetworking73. Others note thatthis trend towards mobile usage isfuelling speculation that the next bigthing will be geo-networking apps,which use virtual data to broker realworld encounters74.

There is a pretty strongargument to be made

that social networksare worth more thanthey are being givencredit for. 71

The next big thing willbe geo-networkingapps, which use virtualdata to broker realworld encounters. 74

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Privacy/security/permissivemarketing

Even if someone gives their consentto share personal data for atemporary need, there remains aneed to ensure that data cannot bemisused. It is argued that the onlytruly effective way is to developprivacy by design and not leavethe issue to be considered afterthe launch of the given platform orinnovative technology75.

Although privacy and social networkshave remained wedded in the press,it is worth noting that all the photos

uploaded, emails sent, downloadingMP3s and other informationgenerally shared on social networksaccounts for only 10% of informationabout that person available in theDigital Universe. The other 90%comprises credit records, surveillancephotos, web-use histories and thelike76. Nevertheless, taking libertieswith personal information is not likelyto generate good will.

It is estimated that by 2020,almost 50% of the information inthe Digital Universe will require alevel of IT-based security beyonda baseline level of virus protectionand physical protection. The amountof unprotected data will grow by afactor of 90 between 2010 and 2020.The failure to ensure the safety ofdata on social networks will markout the losers of tomorrows socialnetworking world.

Digital asset management 77

In 2009 the Digital Universe grewby 62% to nearly 800,000 petabytes(one petabyte equals one million

gigabytes) and in 2010 the rate ofgrowth is forecast to be almost ashigh, to 1.2 million petabytes, or1.2 zettabytes (a zettabyte equals 1trillion gigabytes).

Extrapolating this growth meansthat by 2020, the Digital Universewill be 44 times as large as in 2009,whilst the growth of les will outstripeven that, at a factor of 67. By wayof comparison, the number of IT

professionals is forecast to grow by afactor of 1.4 whilst storage is forecastto grow by a factor of 30.

Hence, we have a growing gapbetween the amount of digitalcontent being created and theamount of available digital storage.In 2009, if people had wantedto store every gigabyte of digitalcontent created, they would havehad a shortfall of around 35%. Thisgap is expected to grow to more

than 60% (that is, more than 60% ofthe petabytes created could not be

stored) over the next several years78.

Using reasonable forecastassumptions on cloud services, it ispossible to conclude that as muchas 15% of the information in theDigital Universe in 2020 could bepart of a cloud service created inthe cloud, delivered to the cloud,stored and manipulated in the cloud,

etc. Even more information couldpass through the cloud, that is, betransported using a cloud servicesemail system or shared community,be stored temporarily on disk drivesin the cloud, be secured via a cloudservice, etc. By 2020, more than athird of all the information in theDigital Universe will either live in orpass through the cloud. Despite thevarious benets, not least of which iscost, the migration to cloud servicescould further muddy ownershipissues. The central questions to beclaried remain: who owns the datain networked systems and who willprotect and preserve it and for howlong?

By 2020, theDigital Universe

will be 44 times aslarge as in 2009.

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Longevity of digital assets

As our ability to store moreinformation has dramaticallyincreased, the lifespan of themediums we have developed hasdecreased. Stone tablets, in usesome eight thousand years BC have

lifespans in the region of 4000 years.Oil paintings, in use from the year600, last centuries, whilst moderncolour photographic lm from 1860,lasts decades79. As technology hasadvanced, the density of data storageon analogue and, subsequently,digital recording media has increased.The downside of packing in data isthat more of the information will belost if just a portion of the recordingmedium becomes damaged.

In a 2009 paper, IBM noted thatrelatively little has been doneto ensure that digital records areaccessible and usable far into thefuture. Trying to use a oppy disktoday exemplies the problem thereare very few media that can readthem in operation and even if theydid, it is likely that some, if not all, ofthe information will have decayed80.

There is also an implication that

ensuring long-term usability is notnecessarily a static process. Rather,it may change over time as theintended use of the stored artifactschanges.

It is said that the internet neverforgets. In the US, the Library ofCongress announced in 2010 that itwill be acquiring, and permanentlystoring, the entire archive of publicTwitter posts since 200681. Owing topotential litigation and of past deedscontinuing to haunt an individual,

the emerging trend is to deliberatelycompromise digital data quicker thanwould normally be the case.

Google not long ago decided torender all search queries anonymousafter nine months. An app calledTigerText allows text-messagesenders to set a time limit from oneminute to 30 days after which the

31

As our ability to storemore information

has dramaticallyincreased, the lifespanof the mediums wehave developed hasdecreased.


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text disappears from the companysservers on which it is stored andtherefore from the senders andrecipients phones. Jeffrey Rosen, alaw professor at George WashingtonUniversity, writing in the NY Timesnotes that expiration dates couldbe implemented more broadlyin various ways. Researchers aredeveloping a technology calledVanish that makes electronic dataself-destruct, after a specied periodof time. Instead of relying on Googleor any given social network to deletethe data that is stored in the cloud,Vanish encrypts the data and thenshatters the encryption key. To read

the data, your computer has to putthe pieces of the key back together,but they erode as time passes, andafter a certain point the documentcan no longer be read82.

Whilst this trend may ensureenhanced privacy, even encouragingmore data sharing, the tipping pointcomes with social networks currentbusiness models. The balancing ofmining data on one hand and its

reduced lifespan on the other holdsforth several commercial, technicaland ethical challenges that socialnetworks will need to address.

Impact on advertising 83

Social networks have the potentialto provide better value than mobilealone because 1) they get animmediate insight from whatindividuals are saying about theirbrand, 2) they can identify andunderstand the inuencers of abrand, product and service andwork to provide them with the bestpossible information allowing themin turn to promote the brand throughtheir own trusted networks and 3)because they will be able to shortendevelopment cycle times as real timeinformation about a product can befed back to the brand, rather thanconducting lengthy primary marketresearch behind one way mirrors84.

The transformation from brandled advertising will be driven byindividuals selecting what brandinformation is allowed to reachthem.

Each individual will have a digitalcog which matches the needsof the individual to their brandafliation.

We will see individuals identifyingbrands which match their ownneeds or interests and grantingthem permission to reach them.

Successful brands in 2020 willbe those which collaborate withindividuals, including them incommunities and ratings of theirproducts or services.

From a mobile advertising point

of view, brands/advertisers areyet to come to the party. Withintheir budget for advertisingthere is no separate line item formobile.

With the establishment ofindustry agreed metrics, the nextdevelopment along the way to2020 will be that reach will beovertaken in terms of value foradvertising measurement.

In order to achieve this transitionfrom reach to value it is essentialthat more is known about theaudience. Here we will see agreater reliance on preferences.

Facilitated advertising - thegreater the understanding aboutindividuals preferences, andway of life, will translate into adeeper relationship between thebrands and the individual.

Peer advocacy in the future willdevelop to include monetisingthese recommendations.It will progress beyondgood citizenship to sharerecommendations or cautionarynotes into a mechanism which israted.

Network inuencers will beincentivised through nancialrewards, for example, where

they have clearly contributedtowards a converted purchase85.Notes Andrew Gill in areview of a white paper fromAcision and Ogilvy, MobileAdvertising 2020vision.

The balancing ofmining data on onehand and its reducedlifespan on the otherholds forth severalcommercial, technicaland ethical challengesthat social networkswill need to address.

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The composition of tomorrowssocial network users is changing.The number of single occupancy

households is expected to increaseby almost 20% to 26 million by 2026(from 2006)86 for example, suggestinga greater utility in the notion of socialnetworks. At the same time Britainis ageing. The oldest age group islikely to grow the most quickly withthe number of Britons over 85 setto more than double over the next25 years from 1.3 million in 2008 to3.3 million by 2033. The numbersof centenarians is set to rise from11,000 to 80,000 by 203387. One-third of British workers will be abovethe age of 50 by 202088

The current projections show thatthe current UK population of 61.4million would rise to 71.6 million by2033, passing the 70 million markby 2029. 55% of the 10.2 millionprojected rise in the UK populationover the next 25 years will comefrom a natural increase in births overdeaths and 45% will be due to more

people coming to live in Britain thanthose emigrating89. Indeed by 2030,8% of the UK workforce will be froman ethnic minority. Half of all new

jobs over the next 10 years will go topeople from ethnic minorities90.

Advanced population ageing is alsolikely to impact government provisionfor the elderly as well as the businessworld. About two-thirds (62.9%) ofprivate sector workers are not saving

into a pension91

, and there is a starkgap between individuals expectationsregarding their income duringretirement and the likely reality92.Based on data from a survey of 2,000people over the age of 18 conducted

by YouGov, Hewitt has calculatedthe gap between current behaviourand the likely reality as 1.2 trillion

equivalent to 80% of the UKs GDP in2008. The age at which people canclaim the state pension needs to riseto 72 within 20 years if it is to keeppace with increases in life expectancy,says the Pensions Policy Institute.93.

The older workforce of tomorrowmay be more aware of socialnetworks than the eldestgenerations of today, but given thepossibility of social network toolsunderpinning internal businesscommunications and governmentservice provision, there is clearly arisk of a misalignment of technologyplatforms and employee skill sets.Business response aside, it is clearthat social networks should be easyto use, intuitive and devoid of anycomplicated procedures.

One-third ofBritish workers

will be abovethe age of 50 by2020 88

3.4 Changing Britain

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Social networks have brought manybenets and innovative opportunitiesfor business, individuals andgovernment to expand what theydo and how they go about theirbusiness. This does not mean thatprivacy or data longevity have yetbeen conquered as issues, nor doesit mean that every social networkset up will prosper or that existingones will lead the industry in itsprogression. New issues will arise,perhaps most notably around theexpected data explosion- how tosafely and effectively store, categorise

and analyse the data will denemany features of tomorrows socialnetworking world. In many waysthe social network (r)evolution isstill in its infancy saturation levelsmay be reached or near reachedin many western societies yet thetrue benets are only just startingto be realised. For example, openinnovation, a process increasinglyresponsible for generating innovativeconcepts and applications for existing

devices and triggering the creationof new products and service, isdependent upon collaborative andoften dispersed efforts of manypeople. These people require acommunications platform to host

interaction. The push towards openinnovation is a result of economicand social trends, but technology specically social networking tools- is enabling it to reach more people,harness a greater depth and breadthof ideas and so help to strengthenthe process.

Government in Britain and acrossthe world is increasingly beingforced to provide more with less.Social networking platforms enablemore direct public communicationwhilst the potential for future social

networks to enable a more efcienttargeting of benets, needs and evenmicro-economic policies, awaits.

Up until now social networks havebeen primarily about individuals.As the scope of networks spreads,they will empower users withmore features; witness the wave ofnew nancial options channelledby social network use and thebenets delivered to educators andstudents. At the same time peopleare poised to begin the era ofmobile networking; an era of deeperand increasingly more relevantnetworking. The potential for realtime targeted ads owing from your

3.5 Conclusions

New issues will

arise, perhaps mostnotably aroundthe expected dataexplosion- how tosafely and effectivelystore, categorise andanalyse the data willdene many features

of tomorrows socialnetworking world.

Government inBritain and acrossthe world isincreasingly being

forced to providemore with less.

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Social networks maybecome increasingly

blended with oursurroundings, changingfrom a conduit ofpersonal information intoa basis for society.

current environment that are thenrelayed across your personal networkis but one possible reality. However,if the past for social networks wasthe individual and the present isincreasingly business oriented, thefuture could be said to be truly social.

Advancing technology will bringus SMART buildings, a plethora ofinternet enabled devices as well asembedded IP in most everyday items.Social networks have the potential tocapture and analyse this information in the future your network could

inform you that your homeswindows are energy inefcient leading to recommendations ofsuppliers generated by your ownnetwork. Thus in one respect, socialnetworks may become increasinglyblended with our surroundings,changing from a conduit of personalinformation into a basis for society.Rather than replace face to faceinteraction, the embedded mobilesocial world could well enrich

personal connections. The potentialdata that could be unearthed is trulytransformative in its potential.

Imagine if our social networks offriends and contacts decided toexcerise our bulk-buying powerand pressured service providers andsuppliers to increasingly do buisnesson our terms.

The potential for social networksto transform established industriesis myriad and were likely to seethis happen in the next ten years.Whether we get there or not willdepend upon many factors someof which cannot be affected by theindustry. However with prots from

social networks forecast to quadrupleand almost quintuple worldwidebetween 2009 and 2013, irrespectiveof the developments mooted above,it would seem that the market isbetting on a bright future.

Social networking

platforms enablegovernment to havemore direct publiccommunication.Future social networkswill enable a moreefcient targeting ofneeds, benets and

even micro-economicpolicies.

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Social network revenue will grow from

1980 2000

Social Networks

Virtual worlds grew by 39% in Q2 2009to an estimated 579 million users

90% of fast growing2009Deloitte FastTech firms havesocial networkpresence

Launched in 1998, Ecademy hasover 200,000 members as of June2010, has 6,000 join up eachmonth through word of mouthalone and is aiming for 10 millionby 2050

In 1980, CompuServe became thefirst online service that offeredchat functionality. In 1982,CompuServe provided wide-areanetworking capabilities tocorporate customers.

FacebooklaunchesFebruary2004

Myspace launchedin 2003. 100 millionaccounts registeredby 2006

Bebo launches in 2005 andbecomes UKs most popularnetwork until late 2007.

Habbo launches in 2000and is aimed at youngerteenagers. 118 millionavatars created as ofJune 2008

Freecycle, a UK charity launches its nonprofit network in 2004. As of March2010, the membership stands at7,090,000 across 4,775 communities

WAYN was founded in2002 now has over13 million members

Linked In launched in May 2003. Hasover 75,000,000 users worldwide.

Facepartylaunched inOctober 2000.Has over 200,000users primarilybased in the UK.

Mobikade launchedin July 2007. Socialnetwork aboutmobile phonecommunity. Basedin the UK

World Wide Web officiallylaunched in 1993

2000 - Friends Reunitedlaunched - grown to 23

million today

Dont Stay In launched in April2003. Social Network concerned

with clubbing, based in the UK.

Hi 5

launchedin June2003. Hasover80,000,000users,

Twitter launched in 2006 .Today has over 65 milliontweets a day.

Reaching 4.6 billionat the end of 2009,the number of cellphone subscriptionsacross the globe willhit 5 billion in 2010Wikipedia 2001

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400m in 2009 to $1,997m in 2013

Development Timeline

2020

Augmented reality goesmainstream in 2020

Immersive Web: 3D worldsannual revenues of $8-10billion in 2015.

By 2019, nearly half of all publichigh school courses (US) couldbe taught online, strengtheningthe need for social networks

0 million social networkers worldwide in 2009

Semantic web 2018improves content access

Growth. By 2012, theernet could be 75 times itse in 2000

Wireless broadbandwill probably reach3-4 out of 5 peopleon the globe by2015-2018.

Reality mining morecommon 2012

Ambient intelligence

2010-2020 renderscomputers invisibleSocial networksunderpin systems

Emerging collective intelligence 2025

Digitalconvergence

Evolving technological ecosystem Smart Systemspredominate in houses,businesses, publicspaces by 2018. 22 billionweb-connected devices inthe world by 2020

Humanknowledgeexceeded by

machineknowledge2016-2020

Haptics technology mainstream2020 networks get physical

May 2010, socialnetworks attract moreUK online traffic thansearch engines for thefirst time.

600m people willuse their phones totap into socialnetworks by 2013

Mass of unprotected datato grow by a factor of 90between 2010 and 2020.

Digital Universe will be 44 timesas large as in 2009 (in 2020)

By 2020, morethan a third of allthe information inthe DigitalUniverse willeither live in orpass through thecloud

25% of enterpriseswill use socialnetworking data toimproveperformance andproductivity by 2015

50% of business-led social mediainitiatives will succeed by 2015,compared to 20% of IT-driveninitiatives says Gartner

Broadband Britain?12m 1gbit lines by 2016

In August2010, FriendsReunited is10 years old

and attractsaround 1.9muniquevisitors amonth

2010

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David is the chief executive of GlobalFutures and Foresight (GFF). In his30 year business career he has heldsenior management positions in bothlarge and small organisations and hasgained real insight over that time onhow visions of the future, if properlyengaged, can help organisationsachieve signicant growth and

change.

He has been involved in public sector,commercial and nancial markets andhas held sales, marketing and generalmanagement positions in companiessuch as the UK based DRG group andUnisys corporation, the global US ITservices business. Whilst at Unisyshe held the position of StrategicMarketing Director for their $2bn(1.34bn) global nancial services

business.

Since co-founding The Global FutureForum in 2000, the Unisys globalthink-tank and now Global Futuresand Foresight, a futures researchbusiness helping business betterprepare for the future, he has workedwith many leading organisationsaround the world including; HenleyBusiness School, Chartered Institutesfor IT(BCS), Marketing (CiM),Purchasing (CiPS) and Directors (IoD),Microsoft, NATO, INTEL, Siemens,Cisco, CSC, Royal Mail, HSBC,LloydsTSB, Reed Exhibitions, Lloyd's,RSA, More Th>n, HSBC, DHL, ACORD,

Mace and many other householdnames across a diverse set ofindustries in Europe, North America,Africa and Asia.

As a regular international conferencespeaker and writer he has becomerecognised as one of the mostinuential future thinkers in our

nation. He is a passionate believerthat we are not victims of what thefuture might hold if we prepareourselves in advance.

He has spoken on UK BBC, MiddleEast TV, German and South Africanradio and appeared on the UK ITNNews channel discussing topicalfutures issues. His experience hasshown him the powerful impact thatglimpses of the future afford business

and government alike as they seek toachieve their strategic goals.

www.thegff.com

About

the Author

Dav

social networks the next generation

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