What is The Impact of Social Media: Is it Irreplaceable?

In little more than a decade, the impact of social media has gone from being an entertaining extra to a fully integrated part of nearly every aspect of daily life for many.

Recently in the realm of commerce, Facebook faced skepticism in its testimony to the Senate Banking Committee on Libra, its proposed cryptocurrency and alternative financial system. In politics, heartthrob Justin Bieber tweeted the President of the United States, imploring him to “let those kids out of cages.” In law enforcement, the Philadelphia police department moved to terminate more than a dozen police officers after their racist comments on social media were revealed.

And in the ultimate meshing of the digital and physical worlds, Elon Musk raised the specter of essentially removing the space between social and media through the invention — at some future time — of a brain implant that connects human tissue to computer chips.

As quickly as social media has insinuated itself into politics, the workplace, home life and elsewhere, it continues to evolve at lightning speed, making it tricky to predict which way it will morph next. It’s hard to recall now, but SixDegrees.com, Friendster and Makeoutclub.com were each once the next big thing, while one survivor has continued to grow in astonishing ways. In 2006, Facebook had 7.3 million registered users and reportedly turned down a $750 million buyout offer. In the first quarter of 2019, the company could claim 2.38 billion active users, with a market capitalization hovering around half a trillion dollars.

“In 2007 I argued that Facebook might not be around in 15 years. I’m clearly wrong, but it is interesting to see how things have changed,” says Jonah Berger, Wharton marketing professor and author of Contagious: Why Things Catch On. The challenge going forward is not just having the best features, but staying relevant, he says. “Social media isn’t a utility. It’s not like power or water where all people care about is whether it works. Young people care about what using one platform or another says about them. It’s not cool to use the same site as your parents and grandparents, so they’re always looking for the hot new thing.”

Just a dozen years ago, everyone was talking about a different set of social networking services, “and I don’t think anyone quite expected Facebook to become so huge and so dominant,” says Kevin Werbach, Wharton professor of legal studies and business ethics. “At that point, this was an interesting discussion about tech start-ups.

“Today, Facebook is one of the most valuable companies on earth and front and center in a whole range of public policy debates, so the scope of issues we’re thinking about with social media are broader than then,” Werbach adds.

Cambridge Analytica, the impact of social media on the last presidential election and other issues may have eroded public trust, Werbach said, but “social media has become really fundamental to the way that billions of people get information about the world and connect with each other, which raises the stakes enormously.”

Just Say No

“Facebook is dangerous,” said Sen. Sherrod Brown (D-Ohio) at July’s hearing of the Senate Banking Committee. “Facebook has said, ‘just trust us.’ And every time Americans trust you, they seem to get burned.”

Social media has plenty of detractors, but by and large, do Americans agree with Brown’s sentiment? In 2018, 42% of those surveyed in a Pew Research Center survey said they had taken a break from checking the platform for a period of several weeks or more, while 26% said they had deleted the Facebook app from their cellphone.

A year later, though, despite the reputational beating social media had taken, the 2019 iteration of the same Pew survey found social media use unchanged from 2018.

Facebook has its critics, says Wharton marketing professor Pinar Yildirim, and they are mainly concerned about two things: mishandling consumer data and poorly managing access to it by third-party providers, and the level of disinformation spreading on Facebook.

“Social media isn’t a utility. It’s not like power or water where all people care about is whether it works. Young people care about what using one platform or another says about them.”–Jonah Berger

“The question is, are we at a point where the social media organizations and their activities should be regulated for the benefit of the consumer? I do not think more regulation will necessarily help, but certainly, this is what is on the table,” says Yildirim. “In the period leading to the [2020 U.S. presidential] elections, we will hear a range of discussions about regulation on the tech industry.”

Some proposals relate to stricter regulation on collection and use of consumer data, Yildirim adds, noting that the European Union already moved to stricter regulations last year by adopting the General Data Protection Regulation (GDPR). “A number of companies in the U.S. and around the world adopted the GDPR protocol for all of their customers, not just for the residents of EU,” she says. “We will likely hear more discussions on regulation of such data, and we will likely see stricter regulation of this data.”

The other discussion bound to intensify is around the separation of Big Tech into smaller, easier to regulate units. “Most of us academics do not think that dividing organizations into smaller units is sufficient to improve their compliance with the regulation. It also does not necessarily mean they will be less competitive,” says Yildirim. “For instance, in the discussion of Facebook, it is not even clear yet how breaking up the company would work, given that it does not have very clear boundaries between different business units.”

Even if such regulations never come to pass, the discussions “may nevertheless hurt Big Tech financially, given that most companies are publicly traded and it adds to the uncertainty,” Yildirim notes.

One prominent commentator about the negative impact of social media is Jaron Lanier, whose fervent opposition makes itself apparent in the plainspoken title of his 2018 book Ten Arguments for Deleting Your Social Media Accounts Right Now. He cites loss of free will, social media’s erosion of the truth and destruction of empathy, its tendency to make people unhappy, and the way in which it is “making politics impossible.” The title of the last chapter: “Social Media Hates Your Soul.”

Lanier is no tech troglodyte. A polymath who bridges the digital and analog realms, he is a musician and writer, has worked as a scientist for Microsoft, and was co-founder of pioneering virtual reality company VPL Research. The nastiness that online existence brings out in users “turned out to be like crude oil for the social media companies and other behavior manipulation empires that quickly came to dominate the internet because it fuelled negative behavioral feedback,” he writes.