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Twitter’s takeover tumult is yet another sign it’s high time for decentralization

Two months ago, the richest man in the world struck a $44 billion deal to purchase one of the world’s most popular digital properties with the express purpose of rolling back the platform’s content moderation policies. Now, he’s trying to back out of it.

Ever since Musk first signaled his intention to take over the embattled platform, the Internet has been locked in frenzied debate over everything from the limits of free speech to the threat disinformation poses to civil society. But one subject the debate has largely glossed over is the role that increased Internet centralization has played in making this entire row possible.

A Tale of Two Internets

Whether it’s Elon Musk at Twitter’s helm, or anyone else, the underlying problems that come with highly concentrated power and closed ecosystems remain fundamentally unchanged. So, as the world shakes its collective fists at Elon Musk, it’s important to remember that the current spat over who’s currently seated at the head of Twitter’s board would be a non-event if centralization wasn’t the standard operating model for our modern day digital spaces.

Centralization has been the standard for so long that many find it hard to even imagine an Internet that isn’t dominated by the likes of Facebook, Twitter, and Amazon. But in its infancy, the Internet was in fact a kind of digital town square. It was able to deliver on that ideal, because it was – just like an actual town square – treated as a commons.

Those days are now far behind us. The digital frontier towns of the early Internet have been reduced to distant memories (for those of us old enough to remember them at all). Just like the early American frontier, once word got out that there was gold to be found there, claims were staked and walls were built around them in record time. And before you knew it, what was once a diverse and vibrant digital landscape was transformed into a tightly-knit patchwork of walled gardens.

The Trouble With Too Much Traffic in One Place

Those walled gardens have kept on growing ever since, bringing us to a present in which a single Tweet from one impetuous executive can have an enormous impact on a large portion of the world’s online discourse. But the ramifications extend well beyond the rules governing public debate. A 2020 survey found that Americans spend more than a third (34%) of their time online inside walled gardens (such as Facebook, Amazon, and Twitter). That’s a massive share of traffic for a tiny collection of properties. And that inflated share of traffic has translated into a veritable vice grip over everything from digital ad spend to public discourse. Case in point, in 2020, the top six walled gardens, including Twitter, took home over 70% of total U.S ad spend.

Now that the third-party cookie is singing its swansong, the social media giants are looking to capture an even greater slice of the digital customer journey — by introducing ecommerce capabilities inside their walled gardens. Using their outsized share of consumer traffic — along with their mountains of capital — the walled gardens are now throwing their weight around in order to entice (if not strongarm) brands to shift their eCommerce activities inside the walled gardens — subsidizing aggressive discounts and free shipping to attract consumers and merchants to their closed ecosystems and establish a new norm for digital commerce.

If their strategy works, the walled gardens will not only own the users and their data, but virtually every touchpoint along the customer journey. Is that what brands want? More importantly, is that what consumers want? Increasingly, signs are pointing toward “no”. Thankfully, some innovative newcomers are paving the way for an alternative.

An Architecture Apart

Some innovative internet newcomers are already showing promise as viable solutions to the problem of centralization, with Shopify being a prime example. In Q3 of 2021, Shopify surpassed Amazon in the total number of unique users to visit its sprawling network of digital storefronts. Shopify-powered sites brought in 1.16 billion unique visitors over the quarter, while Amazon saw only 1.10 billion. And signs suggest this isn’t just an aberration. Since May of 2020, Shopify sites have experienced, on average, year-over-year traffic growth of 108.5%, while Amazon saw its traffic grow by less than 10% over that same period.

While Shopify is still a long way off from Amazon in terms of annual revenues, its steadily rising traffic totals are a promising indication that consumers are ready to explore alternatives to the walled garden model. Moreover, their decentralized, “infrastructure for the open web” approach presents an interesting, easily-implemented alternative to hyper-centralization. It should go without saying that nearly every business in the world today already has a digital property of their own. But not much meaningful innovation has occurred there for quite some time. There have certainly been some meaningful improvements made “under the hood.” But from the average user’s perspective, not much has changed other than how easy it is for them to part ways with their money.

Decentralization begins by design

For the average website to even stand a chance as an alternative to the walled gardens, the organizations owning and operating them need access to tools and infrastructure that are at least as sophisticated as those offered by the social media giants themselves. This idea is ultimately what motivated me and my partner, Vincent Yang, to co-found Firework — to bring the most cutting-edge capabilities to the open web.

And we’re excited to see other entrepreneurs and innovators offering up decentralized solutions of their own. While Firework has focused on enabling live commerce and short-form, shoppable video — today’s lingua franca of the Internet — this same underlying architecture could be used to bring all manner of features and functionality to the open web; without constraining brand identity or robbing organizations of their first-party data. In the same way that Shopify has decentralized ecommerce’s backend infrastructure, Firework has decentralized the front-end user experience — and not only for e-tailers, but also for D2C brands, publishers, and any other organization looking to reclaim their autonomy, identity, and data without fear of losing their audience.

In the Web 2.0 era, individual brands and organizations have been outgunned and outmatched.  It’s been like trying to attract an audience to a one-man show while Cirque du Soleil is in permanent residence right next door. To draw users out of the walled gardens, organizations will need access to a much broader range of capabilities than they’ve been accustomed to in the platform era. And it’s up to tech innovators to ensure those capabilities are developed as part of an open, distributed ecosystem, so that organizations can once again enable real, authentic connections with their audiences — and hopefully rekindle that original promise of the Internet as a network for nurturing connectivity.

Conclusion

For those out there envisioning the walled gardens’ imminent downfall, you’ll probably be left waiting for quite some time. But there’s good reason to believe that their days of total internet dominance are numbered. Brands are growing weary of placing even more control into the hands of the walled gardens of the Internet, and as digital transformation continues full steam ahead, what’s at stake with one’s digital autonomy is steadily increasing. The good news is, it seems we’re approaching an inflection point — in which consumers are also growing tired of the homogenized digital experiences that come with extreme centralization. At the same time, new technologies are paving the way to a more decentralized, Web 3.0 world. In the end, it will be up to brands to decide which path we travel down: Will they take the bait and relinquish even more control to the walled gardens? Or, will they choose a new way forward, and finally reclaim their autonomy? Hopefully, the choice is clear.

Jerry Luk
Co-Founder & President, Firework

Firework is a global leader in humanizing the open web through the language of video. Leveraging shoppable video, live streaming commerce and powerful monetization capabilities, Firework empowers the world’s most dynamic and exciting retailers, consumer brands, and publishers to build engaging video experiences on their owned and operated digital properties and across channels at a global scale. Firework enables organizations to bring new levels of authenticity and connection to online video experiences, speaking to digital natives in the language they understand fully—and taking control of their own customer data. The company has raised over $235 million in capital to date. To learn more, please visit firework.com.