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Virtual economy for notification “credits” on Facebook apps

Preferred program for Facebook apps?
There’s been some recent discussion around the tiered system that’s going to be put into place for Facebook apps to give them the right incentives to be a good citizen within the Facebook economy. I think this is a great start, and you’ll have plenty of apps and startups that are likely to want to participate.

That said, my thought would be that it doesn’t significantly change the dynamics on the platform since a human-based solution to the problem will inevitably cause significant gray area. In my estimation, the major issues around app behavior on Facebook all pretty much center around one thing: How much each app uses and abuses “viral channels” within the platform, which degrades the user experience.

Maximizing local happiness versus global
The problem is that each app, working in its own world, will NOT pursue the global maximum for user happiness. They simply don’t know what the other apps are doing. What this creates is a classic tragedy of the commons situation, where the commons is your Facebook newsfeed/notifications/e-mail inbox.

Proposal for a Facebook notifications point system
So here’s my proposal:

  • Each user session on an app is scored for engagement – meaning, pageviews/time-on-app/revisits and any other metrics that would be useful
  • The app creator then gains “points” for creating more engagement with their users
  • They can then use these points for different kinds of notifications. Some notifications that are more obtrusive cost more points (like emails), and others which are less annoying cost less

Then from a global context, Facebook can regulate the end-user experience by figuring out if their users are getting too many e-mails or too many notifications. If so, they can just raise prices so that notifications are more expensive to buy.

More analysis needed
I’ll be the first to admit I haven’t thought through all the implications of a system like this. In particular, here are a couple issues worth thinking about:

  • What are all the point-generating activities? Engagement, positive reviews, % retained install rate?
  • What are all the point-costing activities? Sending notifications? Uninstalls? Report as spam?
  • Will a secondary market emerge? Is it a good idea to let people pay for notification points?
  • What are the ways people will cheat the system? How do you counterbalance that?

Suggestions and comments welcome :)

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