Everyone is talking about Facebook’s privacy debacle and Pete Cashmore (@mashable @petecashmore) does a great job of being neutral in his recent Mashable/CNN post, even though he isn’t.

Pete’s take on the Facebook controversy has only two facets:  1) the positive side of the sharing issue is that sharing is beneficial to users because more info = better service to all, and 2) the negative, evil side of the sharing issue is that Facebook wants to make more money from its users in every way possible by selling your personal data and serving ads at your eyeballs.

Shortbord thinks that another dimension should be added to the discussion and that Facebook could have avoided this entire shitstorm of criticism and people fake-leaving the service (that’s right, 540MM users at last count – pretty sure Facebook will come out of this controversy net positive in a huge way). Here’s  how: let users benefit financially from sharing their info.  All of a sudden, these privacy concerns would be turned upside down and users would be wondering “how can I share more of my personal info so that I can earn more value from advertisers looking to pay me to spread their brand message to my social spheres.” Give people an incentive to share, other than the incentive of making an already phenomenal service better.  People simply don’t understand how much better Facebook would be if it was as open as Twitter, and they don’t care to learn.

This begs the following question: “well how do we let people make money from all of their Facebook activity without turning the network into a spam machine?” The answer is simple: regulated, transparent, authentic endorsement badges on profiles, in status updates, and anywhere else Facebook and individuals can maximize the efficacy of the ad unit while minimizing the intrusion on user experience. Why are display ads reserved only for websites, when people are building audiences, serving impressions and generating leads all of the time? After all, people are the new distribution channel on the social web.

Facebook is the center of the web universe, but its truly holding back the evolution of social media marketing by continuing to show ads AT users instead of WITH them.  When ad dollars are flowing directly to users, and websites hosting the users’ time and user-generated content are earning a percentage, only then will social media be monetized to its full potential.

Facebook, MySpace, Youtube, Flickr et al have monetization backwards. So does every other company that relies on people to be successful. Social media needs a new revenue strategy, and services with millions of users are sitting on a goldmine.

I feel like I'm taking crazy pills. I have millions of users focusing on each other. Why don't they notice the ads I show them on the side of the page??

According to Wikipedia: “Social media is a term used to describe the type of media that is based on conversation and interaction between people online.”  Why then, are social media companies applying the same monetization approaches that have been used for the past hundred and fifty years on traditional media like newspapers, magazines, and every other type of print publication – by selling ads on the top and sides of the page – to monetize social media apps? Spending dollars on websites in the hopes of getting noticed is archaic.

Conversation. Interaction. People. Quite clearly, on social websites, we are focusing on ourselves, our friends, and the cool things we are all doing.  We could care less about ads that are located on the side of the page because they are removed from the conversations we are having. In fact, we have trained ourselves to ignore traditional display or banner ads (regardless of how contextually relevant they are) because we control our viewing experience on the web. We simply don’t care to see things that are outside of our personal bubbles.

What is clear is that traditional display ads are not doing a very good job of moving people into the marketing funnel because they don’t make sense on social websites. Marketers know this, and are desperately trying to find any and every way to be relevant to consumers in this new social web environment. In order to fix what’s broken, marketing dollars need to drill down a layer to the most common denominator of all social websites: people. Who cares about trying to run ads on sites where you think your target consumers are going to be (and then crossing your fingers that your ad will be noticed), if your ad is not attached to my friend, I simply will not care about it.

Shortbord thinks social media monetization is upside down. In order to make money, social websites need to stop serving ads AT people and start serving ads WITH them. People are already the distribution channel for content on the social web. When people become the advertising distribution channel, ads become noticed and finally relevant.

Simple, visual ad unit that doesn't get in the way. I notice it because its relevant to my friend

We should monetize ourselves just like websites do – by attaching an ad unit to every post that our audience sees. People are just like websites in that some of us serve billions of impressions per month (yup, that’s a fact) and others serve only hundreds. But the point is, that these impressions we are serving are better than traditional display ads because they’re ours, and we are influencers to every one of our friends, family, followers, and passers-by. People are interesting, whether we know them or not. If its relevant to my friend, the person I follow, the celebrity I love, then its relevant to me too. Let us – the people – sell ads that we want to see and websites will finally make money that matches their popularity.

If you’re a celeb or influencer, you’re probably wondering if Ad.ly is dead in the water. According to their new CEO, nope.  I’m curious to see how it plays out, considering they’re smart people with lots of cash. That said, their entire business model - the reason they exist – has been taken away from them.  No longer can celebs and influencers earn money for being popular Twitter users, they now have to find a new way to monetize their popularity on Twitter and the hundreds of other websites where people tune into their every word/photo/video.

Welcome to Shortbord.  Simply put, the reason we exist is to enable celebs and influencers to monetize their popularity on the web, just like they do on TV, radio, newspapers, magazines, billboards, etc.. – through visible, transparent personal endorsements. Our endorsement badges, as we call them, are better than in-stream advertising because they can’t be confused with genuine conversation.  Your followers – people that tune into your every word – don’t feel used and abused because you’ve just spammed them with a paid advertisement when they thought they were getting your genuine content.  In-stream ads can be sneaky and misleading, and people hate feeling cheated.

That said, endorsements are badass.  Ashton and Nikon.  Maria Sharapova and Canon.  Dr. Dre and Dr. Pepper.  Justin Timberlake and Sony.  Michael Jordan and Gatorade.  Michael Jordan and Nike.  Rihanna and Cover Girl. Derek Jeter and Gillette. Ellen Page and Cisco.  Peyton Manning and DirecTV.  Danica Patrick and GoDaddy.  Emma Watson and Burberry.  These celebs are proud of their endorsements, and certainly don’t hide their affiliations with these brands.  The more people that see these endorsements, the more valuable these endorsements become.

No hiding this endorsement!

Shortbord extends endorsements to the web, where people are spending more and more time every day.  The more people that see Shortbord endorsement badges, the more valuable they become. Celebs and influencers have the ability to put endorsement badges on any blogs, websites and social network profiles they control and make their endorsement badge as visible as possible.  Simply put, make money from being popular and influential, because brands want to associate themselves with you in order to reach your audience.

This post was inspired by Peter Kafka’s (@pkafka) article on AllThingsD: Twitter’s Free Love Era Comes to an End

Hello Twitter. We at Shortbord have been admirers of yours for quite some time.  We’ve watched you change the way media works by turning every person – from our next door neighbors to the biggest Hollywood stars – into their own personal media companies.  All it takes is a web connection and a few interesting words to say (emphasis on few words), a few links to share, some hard work, and a little bit of luck, and even the little guys and girls out there can become Twitter stars with millions of followers hanging on their every word.

You’ve given popular people the same challenge that popular websites have: to keep posting interesting anecdotes, finding great content, pics and videos in the never ending attempt to grow followers and become bigger celebrities. Until recently, celebs were able to make a little bit of money through their Twitter content distribution channel through services like Ad.ly, SponsoredTweets, MyLikes (just to name a few), but now you have outlawed any 3^rd party service that runs ads through personal profiles with your new TOS.  While we applaud the move to eradicate spam from “the pipes” that connect us, we think that the move bites off your nose to spite your face.  Here’s why:

Shortbord looks at the way people use Twitter, as well as hundreds of other popular social media services ranging from blogs, to social networks and content sharing sites, and realized one interesting thing: web services provide the means, but people provide 100% of the value of social media.  When it comes down to it, Twitter, Facebook, or any other social media app without millions of die-hard users is simply just another web app.  Popular services are successful because loyal users contribute their photos, videos, conversations, relationships, daily anecdotes and valuable time increasing the value of the service to each other and to you – the website owners.  This value has been evident in lofty equity raises, but has seldom turned the corner on cash flow generation for website owners because no sites have yet realized that when people make money for themselves, and websites earn a fraction of each person’s earnings, social media can actually be monetized.

Shortbord enables people (yes – the same people that create ALL of the value of Twitter as well as thousands of others) to make money from having big audiences, just like websites do – with targeted and relevant display ads that don’t interrupt the conversation but even better – enable the individuals to express themselves without saying a word. We do it on any site that has embedded our endorsement badges, and both site owners and people get paid.  Endorsement badges are valuable because people are valuable and endorsements are personal.  My friends, the celebrities I follow, and the industry experts I tune into every day on the web are extremely influential to me and anything they promote is instantly on my radar. Visual, simple, effective.

So Twitter (and every other social app, with lots of users and no clear monetization capability), in our humble opinion, if you want to start monetizing your service and fix social media advertising once and for all, here’s how it should be done:

1)      Let your users make money on your platform. They will rely on your platform even more than they already do

2)      Earn a percentage of each person’s endorsement earnings based on the impressions / clicks of their endorsement badges on your property.  We call it a crowdsourced advertising model – websites with the biggest crowds make the most money

3)      Brands can finally connect directly with their target consumers and stimulate highly influential word-of-mouth endorsement across social spheres – after all, this is the primary goal of advertising right?

To summarize, people are like mini-websites on the social web in that they post content, manage large audiences, and serve millions of impressions and leads on a daily basis.  Let them make money just like websites do, and you’ll no longer have to worry about spammy or inauthentic ad units that steal genuine conversations.  Shortbord Endorsement Badges don’t change a thing, other than to add a new level of expression to each person’s post. Everyone wins through a simple Endorsement Badge.

Will Google crack the code to "Social"

I came across an All Things D article that I thought posed an interesting enough question to share on our humble blog.  Everyone talks at length about the success of Facebook and Twitter when it comes to Social, and of course the demise of MySpace (that is still a website right?), but what about Google? I still do not understand what they attempted with Wave and I turned off Buzz within a week.

The latest from Giga Om is that Google seeks to hire a “Head of Social.” Does Google believe that one person can make a difference? I must admit that I do like how Google is essentially admitting their failures, but would love to hear more about their future plan.

Do you still use Buzz? Did you try to use Wave after watching Dr. Wave’s intro video? Will Google ever solve the “Social” question?

We decided to launch Shortbord because we don’t like the other options available to bloggers when they want to monetize their tweets, blog posts, etc… As consumers of content, we don’t like reading sponsored posts, and we don’t think bloggers want to sneak advertisements into their stream. Shortbord’s goal is to provide a transparent way for people with large followings to make money from all of the great contributions they make to the web, and to do so without representing someone else’s message as their own.  One recent blogger even said that paid blogging “violates the trust that your followers place in you as a person of influence.”  Even though bloggers monetize their web presence through Shortbord, we are a different kind of service entirely.

From the outset, we couldn’t get comfortable with any service that can only be used once out of every 15-20 posts.  When blogger represent a sponsors paid message as their own, only a small fraction of their followers typically see the ad, and when they do notice, it puts the blogger’s valuable reputation in danger.  According to last night’s episode of Glee (I’m paraphrasing here, and I swear my girlfriend makes me watch this show!): a reputation takes a lifetime to build but only a moment to destroy.

Honestly, my girlfriend makes me watch it.... and last season was waaay better.

Followers, like-minded individuals and complete strangers know you and your blog because of the interesting content you produce.  You’ve spent years cultivating a reputation that enables your digital persona to generate as much exposure as many entire websites do.  When you think about all of the times your content is viewed across the hundreds of websites where people view your content, it can be a staggering amount of views.  We think you should be able to make money from all this exposure, just like a website, without damaging your reputation.

Embedding shortbords on your blog gives you a way to monetize your digital persona without interrupting your stream.  You can make money and still write about anything you want.  Even better, you have total control over the brands you let rent space on your shortbord.  Our goal is to have shortbords on every blog, microblog, social network, message board, review site, forum and anywhere else your posts are viewed.  Shortbord provides you with authentic, genuine endorsements that don’t put your reputation at risk. Continue being noticed, and there is no limit to how much brands are willing to pay to be associated with you.