Matt Webb has an interesting post looking at the sale of Instagram to Facebook through the eyes of an aspect of Marx, particularly this quote from this very good article about Marx by John Lanchester in the London Review of Books:
This idea of labour being hidden in things, and the value of things arising from the labour congealed inside them, is an unexpectedly powerful explanatory tool in the digital world.
Matt applies this to Instagram:
What is the labour encoded in Instagram? It’s easy to see. Every “user” of Instagram is a worker. There are some people who produce photos — this is valuable, it means there is something for people to look it. There are some people who only produce comments or “likes,” the virtual society equivalent of apes picking lice off other apes. This is valuable, because people like recognition and are more likely to produce photos.
I, too, tend to think of this sort of thing when an Instagram-like company gets sold, and hence, suddenly, valued in monetary terms. It’s the sale of the value created by the users.
This isn’t quite right of course — the users wouldn’t have created that specific lump of value without the framework (or factory, in Matt’s metaphor) that was first put in place, and then maintained and improved, by the company’s owners. But still, the factory would be worth little without the subsequent “work” (a loaded term, so we could just say “activity”) created by the mass of people.
But then, also, Matt talks about the products these people create: photos and comments and “likes”. And the trouble with this whole analogy is whether those products are actually worth any money. Has someone who’s posted 1000 photos over the past year increased Instagram’s worth more, right at this moment, than someone who’s only posted one?
The answer varies. For Instagram, which is mostly about the stream of current photos, I’m not sure there is much value in all these photos posted in the past. In fact, they could be a liability — unless Instagram has a policy of deleting photos after a certain time, each one adds incrementally to the service’s running costs. By posting thousands of photos you could say I’m reducing Instagram’s value, not increasing it.
A service like Twitter, which is also very much about the now, is similar. What’s the value to Twitter of all the tweets posted by people over the first few years of its existence? It’s practically impossible for anyone to see them, so can they increase the company’s value?
But maybe a service like Flickr, which isn’t quite so focused on the sharing of the moment, and makes it easy to catalogue and share and explore and discover the archive of past photos, does gain value from all those historical products. People can access them, and they’re part of what make Flickr Flickr. Plenty of people use the site as their own photo archive or portfolio and, for them too, the old photos are much of the value and attraction.
(I’m glossing over the wrinkle that Flickr charges people for Pro accounts, which let you keep your old photos visible, while Instagram and Twitter are free. I’m not sure this makes a vast difference to the discussion.)
And this is odd, this difference in possible value between Instagram and Twitter’s old products, and Flickr’s. Because it suggests the value of these millions of photos or tweets is purely determined by the product strategy and design of the service.
We could say that Instagram’s old photos give it little value because exploring them isn’t terribly easy and (I suspect) almost no one does it. But what if tomorrow Instagram suddenly launched a website that made it beautifully easy to search and explore that vast archive. What if people started using it to do amazing things with these old photos, attracting lots of eyeballs and activity and new users. Do each of these photos suddenly acquire more value?
If so, then where was that value? Where did it come from? We did say those photos had no value, and that all those people hadn’t actually added value to the company by taking the photos. And yet, suddenly, when those old photos are visible and start attracting people, it looks like value had been created after all.
Maybe it’s more about potential value, a value that has to be unlocked and maximised by the service’s owners. By posting a photo, or tweeting, or liking, we don’t necessarily create any value. We could even reduce value. But it’s up to those running the service to determine this, and to give our actions as much value as they are able.
I’m not entirely sure this is right. I’m prodding at my knee-jerk application of barely understood Marxism. And, of course, there’s much more to the value of an internet service than the things created by users in the past. And I think we know this. It’s about the potential to increase the number of users and to keep those it already has (if there is inherent value in each photo, it’s in the photo’s ability to make its taker feel more locked-in, and unable to leave). And it’s about the potential ability to make money from the eyes and activities of all those users, possibly in entirely new ways.
While there’s definitely something in the Marx analogy -– Instagram would be worth very little without all that past activity — I’m not sure it’s quite right, and certainly not the whole story. Each Instagram photo doesn’t necessarily add a unit of value to Instagram. If there is any value in each photo it needs to be unlocked and maximised by Instagram’s owners.