How much is Facebook worth to YOU? People would only give up network for a year if they were PAID $2,000, according to a survey
- Study of more than 1,300 adults showed how valuable firm was to youngsters
- Research involving academics at four US universities including Kenyon College
- Facebook is top social networking site in the world and third most used website
- This is despite the recent Cambridge Analytica election data handling scandal
People addicted to social media would demand up to $2,000 not to use Facebook for a year, according to new research – despite the recent data handling scandal.
A study of more than 1,300 adults showed the social networking website was worth that much to them.
And if everyone valued it at that price, it would at least quadruple the value of the company.
A team of researchers carried out three real-life auctions that revealed Facebook users would require between $1,139 and $2,076 to deactivate their account for a year.
First author Professor Jay Corrigan, an economist at Kenyon College in Ohio, found that students placed a higher value on Facebook than community members. Pictured is a stock image
First author Professor Jay Corrigan, an economist at Kenyon College in Ohio, said: ‘Social media, and the internet more broadly, have changed the way we live and the way we keep in touch with friends and family.
‘But it’s hard to find evidence that the internet has made us richer or more productive at work.
‘We know people must derive tremendous value from Facebook or they wouldn’t spend millions of hours on the site every day. The challenge is how to put a dollar value on a service people don’t pay for.’
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Corresponding author Prof Sean Cash, an economist at Tufts University in Boston, said: ‘Auction participants faced real financial consequences, so had an incentive to seriously consider what compensation they would want to close their accounts for a set period of time and to bid truthfully.
‘Students placed a higher value on Facebook than community members. A number of participants refused to bid at all – suggesting that deactivating Facebook for a year was not a welcome possibility.’
It’s the first time the site’s value to its users has been compared to its market value or its contribution to gross domestic product.
People were actually paid to close their accounts for as little as one day or as long as one year.
The study published in PLOS ONE found that young people would need an average of more than £1,000 to deactivate Facebook for a year
Prof Corrigan, who has done a number of studies involving experimental auctions, said winners were paid upon proof their membership was deactivated for the set period of time.
Facebook, with more than two billion global users, is among a string of social media websites that provide access at no cost.
So the researchers asked volunteers how much they would require to give up their Facebook account for a fixed period – from one day to one year.
The first auction involving 122 US students at a college in the Mid West found the average bid for deactivating Facebook for one day was $4.17 (£3.30; for three days, $13.89 (£11.00); and for one week, $37.00 (£29.27).
Over a year this would work out at between $1,511 to $1,908 – £1,200 to £1,500, said the researchers.
The second included 133 students and 138 adults from a large Midwestern university and town.
Facebook, with more than two billion global users, is among a string of social media websites that provide access at no cost
The results come despite market fluctuations and a series of controversies. Zuckerberg, 33, is pictured here after he was called to testify after it was reported that 87 million Facebook users had their personal information harvested by Cambridge Analytica, a British political consulting firm linked to the Trump campaign
The average bid to deactivate Facebook for a year in the student group was $2,076 (£1,643) while the average bid in the community group was $1,139 (£900).
The third of 931 adults in the US with an average age of 33 found the average bid to deactivate Facebook for one year was $1,921 (£1,520).
The study contrasted the company’s market capitalisation with the value placed on it by its users.
For example, based on a market valuation of approximately $420 billion (£332bn), and about 2.2 billion users, the market value of Facebook would be approximately $190 (£150) per user.
This is less than a quarter of the annual average value of Facebook access from any of the auction samples.
The researchers wrote: ‘While the measurable impact Facebook and other free online services have on the economy may be small, our results show the benefits these services provide for their users are large.’
They also pointed out Facebook remains the top social networking site in the world and the third most visited site on the internet – after Google and YouTube.
This is despite market fluctuations and a series of controversies. The survey samples – somewhat skewed toward students – are not necessarily representative of all Facebook users.
But there was consistency in price valuation by users across the samples – and across different time frames, said the researchers.
The study was published in PLOS ONE.
FACEBOOK’S PRIVACY DISASTERS
Facebook in late September disclosed that it had been hit by its worst ever data breach, affecting 50 million users – including those of Facebook boss Mark Zuckerberg and COO Sheryl Sandberg.
Attackers exploited the site’s ‘View As’ feature, which lets people see what their profiles look like to other users.
The unknown attackers took advantage of a feature in the code called ‘Access Tokens,’ to take over people’s accounts, potentially giving hackers access to private messages, photos and posts – although Facebook said there was no evidence that had been done.
The hackers also tried to harvest people’s private information, including name, sex and hometown, from Facebook’s systems.
Facebook said it doesn’t yet know if information from the affected accounts has been misused or accessed, and is working with the FBI to conduct further investigations.
However, Mark Zuckerberg assured users that passwords and credit card information was not accessed.
Facebook says it has found no evidence ‘so far’ that hackers broke into third-party apps after a data breach exposed 50 million users (stock image)
As a result of the breach, the firm logged roughly 90 million people out of their accounts earlier today as a security measure.
Facebook made headlines earlier this year after the data of 87 million users was improperly accessed by Cambridge Analytica, a political consultancy.
The disclosure has prompted government inquiries into the company’s privacy practices across the world, and fueled a ‘#deleteFacebook’ movement among consumers.
Communications firm Cambridge Analytica had offices in London, New York, Washington, as well as Brazil and Malaysia.
The company boasts it can ‘find your voters and move them to action’ through data-driven campaigns and a team that includes data scientists and behavioural psychologists.
‘Within the United States alone, we have played a pivotal role in winning presidential races as well as congressional and state elections,’ with data on more than 230 million American voters, Cambridge Analytica claims on its website.
The company profited from a feature that meant apps could ask for permission to access your own data as well as the data of all your Facebook friends.
The data firm suspended its chief executive, Alexander Nix (pictured), after recordings emerged of him making a series of controversial claims, including boasts that Cambridge Analytica had a pivotal role in the election of Donald Trump
This meant the company was able to mine the information of 87 million Facebook users even though just 270,000 people gave them permission to do so.
This was designed to help them create software that can predict and influence voters’ choices at the ballot box.
The data firm suspended its chief executive, Alexander Nix, after recordings emerged of him making a series of controversial claims, including boasts that Cambridge Analytica had a pivotal role in the election of Donald Trump.
This information is said to have been used to help the Brexit campaign in the UK.
It has also suffered several previous issues.
2013, Facebook disclosed a software flaw that exposed 6 million users’ phone numbers and email addresses to unauthorized viewers for a year, while a technical glitch in 2008 revealed confidential birth-dates on 80 million Facebook users’ profiles.
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