As Jason wrote about over on TechCrunch, SocialMedia has paid out over $8 million to developers on social networks. It’s a good sign, and I hope it will get people thinking twice about “childish” or “pointless” applications and realize that at least these earnings are a proxy for the enjoyment people are getting out of social applications.
I also think it’s important to note that this money was not paid out for shares or as a loan. It’s earned. Teams of one, two, or three developers have created fantastic products and kick start their own media properties on that income. Networks provide massive distribution and we provide monetization.
This is why I see monetization tools from a company like SocialMedia as one of the chief enabling technologies of social platforms. That $8 million was the gas in the tank that kept platforms like Facebook, Bebo, and now more so MySpace and Hi5 going. Without it, networks would have to cherry pick and fund the applications they think will succeed. Instead, the ability for developers to make money on their own creates a free and dynamic marketplace. Facebook or MySpace doesn’t have to dream up the best applications. The monetary rewards to developers will do that.
I expect platforms to change a great deal over the next year. Applications will improve and methods of monetization will as well. I look to developers like Playfish and the brand advertisers on our network as a sign of this maturity. With companies reacting to the shift in attention toward the internet and social networks, I only expect the trend to become more pronounced.