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Peter Yared is the CTO/CIO of CBS Interactive, a top ten Internet destination, and was previously the founder and CEO of four enterprise infrastructure companies that were acquired by Sun, VMware, Webtrends and TigerLogic. Peter's software has powered brands from Fidelity to Home Depot to Lady Gaga. At Sun, Peter was the CTO of the Application Server Division and the CTO of the Liberty federated identity consortium. Peter is the inventor of several patents on core Internet infrastructure including federated single sign on and dynamic data requests. Peter began programming games and utilities at age 10, and started his career developing systems for government agencies. Peter regularly writes about technology trends and has written for CNET, the Wall Street Journal, BusinessWeek, AdWeek, VentureBeat and TechCrunch.

Many thanks to Bob Pulgino, Dave Prue, Steve Zocchi and Jean-Louis Gassée for mentoring me over the years.

Friday, February 21, 2014

Mobile Contacts Are Now The Real Social Network


This post was also published on TechCrunch.

Facebook’s surprising acquisition of WhatsApp signals that it has realized that users’ true social network is the contact list on their smartphones. Mobile contacts are usually limited to people a user knows well and actually communicates with, a veritable treasure trove when compared to the copious list of Facebook friends that many users have accumulated over the years.

Adding someone to your phone is more intimate than friending them on Facebook. And messaging someone through their phone number is much more intimate than a Facebook message, something that Mark Zuckerberg himself says is akin to informal e-mail. Facebook had the opportunity to own the social graph for new apps with Facebook Platform, which spawned multiple successful companies such as Pinterest that used the “follow all my Facebook friends” feature to build their own social networks.

Threatened by the emerging networks, Facebook decided to clamp down on new “competitive” social networking apps, and turned off access to its social graph for emerging messaging apps like Voxer and Vine.

Without access to the Facebook social graph, the new generation of mobile communication apps such as Snapchat and Secret use mobile contacts exclusively to build connections between users.

Younger and international users are particularly attracted to the mobile contact as the defining criteria of their true social network. As Path’s struggles have shown, attempting to force an intimate social network with the same real-name mechanism as Facebook does not work.

Social Network Identity Who It’s For
Facebook Real Name Casual acquaintances
Instagram Alias Aspirational following
WhatsApp Phone Number Actual friends

Facebook had already acquired the ability to have a unilateral, aspirational follow capability akin to Twitter with its Instagram acquisition. WhatsApp offers a social network of 450 million users that are intimately connected with each other by phone numbers.

With this acquisition, Facebook now controls the intersection of all three kinds of social graphs: casual acquaintances, aspirational following, and intimate relationships. And that’s worth quite a premium.