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Social Media Is Doomed to Fail

Written By Alexander Boulden

Posted February 22, 2023

Dear Reader,

Technology has a funny way of evolving.

A past colleague of mine always use to say that social media should come with a Surgeon General’s warning.

The older I get, the more I understand what he meant.

I come from the last generation of kids who didn’t grow up with smartphones and apps.

To this day, I don't feel like I need them.

When I was growing up, to pass the time, we read books, wrote letters by hand, played board games, went to arcades with a stack of quarters, rode bikes around the neighborhood, explored the woods, climbed trees, walked on the railroad tracks, and took hours-long road trips with nothing but a CD player or the radio to listen to…

Once the computer was introduced into the household, a lot of things got easier, sure, but we lost touch with a lot of the aspects of life that make us human.

We all had flip phones in college, and not once did I feel like I needed something more.

I can’t imagine how the iPad generation can concentrate on anything.

Sure, they've figured out how to monetize the internet with clickbait thumbnails that pose ridiculous questions that go unanswered, but that could soon change.

Technology is evolving before our eyes.

Facebook founder Mark Zuckerberg repeatedly insists he created social media in order to bring people together, but we all know that’s only a half-truth.

He’s not fooling anyone.

He saw the dollar signs way before anyone else, which is why he’s one of the wealthiest people in the world.

But people are catching on.

Social media companies aren’t as profitable as they once were.

And they may even be running out of money.

Here's the proof.

When Elon Musk took over Twitter, he said the company was on the fast track to bankruptcy.

To get more revenue, last month the company announced Twitter Blue, which gives users a blue check mark next to their name, dubbing them a “verified user” — all for the low price of just $11 a month.

And now, in typical Zuckerberg copycat fashion, Meta’s hopping on the bandwagon as well.

According to Reuters, “Meta Platforms on Sunday announced that it is testing a monthly subscription service, called Meta Verified, which will let users verify their accounts using a government ID and get a blue badge, as it looks to help content creators grow and build communities.”

He’s charging $11.99 per month on the web and $14.99 on mobile.

Call it what you want, but it looks like they’re grasping at straws trying to keep these tech behemoths afloat.

One final attempt to make a little extra scratch.

To add insult to injury, this week, the Supreme Court is hearing arguments in two cases that could finally bring the Big Tech social media giants to their knees.

Up Next

You’ve surely used YouTube or Instagram and seen the suggested content and wondered, “Why the hell are they suggesting this to me?”

It’s this “recommended” content that the Supreme Court is scrutinizing this week.

The Washington Post writes, “The Supreme Court on Tuesday will hear oral arguments in Gonzalez v. Google, a lawsuit that argues tech companies should be legally liable for harmful content that their algorithms promote. The Gonzalez family contends that by recommending ISIS-related content, Google’s YouTube acted as a recruiting platform for the group in violation of U.S. laws against aiding and abetting terrorists.”

Nohemi Gonzalez died in a 2015 terrorist attack in Paris.

The case hinges on a piece of legislation written by Congress in the '90s, well before the internet was the monster it is today.

Section 230 of the Communications Decency Act of 1996 states, “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” However, the act also encourages companies to remove violent or obscene material.

NPR notes that the law distinguishes between interactive computer service providers and other purveyors of information, which is why journalists and publishers can get sued but Big Tech can't.

Essentially, companies like Google or Facebook merely act as a conduit of information and aren’t held liable for what users see on their sites.

Internet companies have since used Section 230 as a shield, deflecting blame when the content harms others and protecting themselves from being sued for damages.

That could change this week as the high court hears two cases that argue Google violated the Federal Anti-Terrorism Act by recommending terrorist videos to increase ad revenue.

Google denies any wrongdoing, and the other Big Tech goliaths argue Section 230 defends free speech and that changing it will affect how the internet operates by limiting the amount of content users can post.

We’ll see what happens, but these cases could deal a serious blow to Google, Meta, Twitter, and the like, as it could change how these companies display ads, which could seriously hurt revenues not only for them but also for small business.

These cases come at a critical time in the history of the internet.

We’re at an inflection point with only one solution.

AI to the Rescue

I’m going to make a bold prediction about the whole situation.

Ten years from now, social media won’t be around anymore.

At least not in the way we know it today.

In fact, the companies we know and love to hate — Google, Meta, Twitter…

They’ll no longer be as powerful as they are today.

It's just the natural ebb and flow of the market.

At a 2021 investor conference, Warren Buffett pointed out that 30 years ago, none of the largest companies by market cap are the largest today.

Social media and online advertising companies have used the internet as their personal piggy bank and destroyed it in the process.

But this new AI we've been hearing so much about can change all that.

If we use AI wisely, it can save us from ourselves.

But it will destroy us if we're not careful.

Either way, you'll want to ride the AI bull market.

AI and the smaller companies working on it will supplant the current Big Tech companies.

It's just a matter of time.

It's the next evolution of technology.

Technology has a funny way of evolving.

Stay frosty,

Alexander Boulden
Editor, Wealth Daily

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After Alexander’s passion for economics and investing drew him to one of the largest financial publishers in the world, where he rubbed elbows with former Chicago Board Options Exchange floor traders, Wall Street hedge fund managers, and International Monetary Fund analysts, he decided to take up the pen and guide others through this new age of investing.

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