Facebook launches "Graph Search": future of the web or stalker tools?

And what does it mean for the bottom line.

Facebook yesterday demonstrated its new service, Graph Search. The company is proposing to let people search their "social graph" to find new, useful information. (The social graph is the network of relationships between you, your friends, and their friends. Sadly, it is not a search engine for graphs.)

The company is positioning the search service as a competitor to, well, everything. Search for "music my friends like" – graph search is designed to take natural language input – and you've got something which can take on Last.fm or This is My Jam. Search for "restaurants in London my friends have been to" and you've got a rival to Foursquare. "Friends who work for PWC" could fill the same niche as LinkedIn, and "Photos taken before 1995" offers something which only Flickr does half as well.

The potential is huge, and, judging by Steven Levy's exhaustive behind-the-scenes account (impressive too for the total absence of leaks it resulted in – the man can keep a secret), Facebook is betting the farm on it.

But there're two potential speed-bumps ahead for the company. The first is that perennial Facebook bugbear: privacy. The company is careful to emphasise that only things which are public or shared with you will show up when searched for — but that relies on users understanding how privacy settings actually work, which has historically not been the case. That's not Facebook's fault per se, but it also won't save them from a user back-lash. And as the company has learned before, while it recognises a binary "public/private" divide, most users don't think in such black-and-white terms. The launch of the News Feed, way back in 2006, was widely opposed by existing users, because despite merely aggregating content which was already visible elsewhere, it felt like an infringement of privacy.

Consider: Person A rejects friend requests from Person B who is a creepy stalkerish character. They nonetheless have several mutual friends. Can B search for "Posts by A which friends have commented on"? (Those posts would be visible to B now, but not aggregated in any one place). Similarly, someone who checks into a specific location on a regular routine might not appreciate that suddenly being aggregated together, making the routine clear to all.

Where privacy is emblematic of Facebook's past concerns, the other problem Graph Search faces strikes at the heart of where it's future problems lie. The usefulness of the service is directly tied to people using Facebook the way Facebook wants them to. That means liking a lot of things; filling in all your personal information, and keeping it up to date; checking in every time you go out; and making all of that public, or at least softening your privacy settings.

For many, Facebook has become a glorified PA: it's a way to contact friends whose other details you have lost, and a way to bulk-invite people to social events, but as a social network, its utility is fading. Graph search doesn't seem to do anything to reverse that trend, because it doesn't offer any incentives to change the data you put in to Facebook — just change how you get other people's data out.

Of course, hovering unspoken during the launch is the key question: will this make more companies want to advertise on Facebook, or increase the amount the company can charge for space? The technology underpinning the search will almost certainly help the company provide better services to advertisers, but being useful — to admen or end users — doesn't necessarily translate into revenue.

What the service does demonstrate is the foresightedness of Twitter's broadsides against Instagram, the Facebook-owned photo network. While Instagram was only using its Twitter connection to enable people to export their relationships to the service, Graph Search reveals that the knowledge of those links — the literal social graph — can have intrinsic value. By limiting Facebook's access to Twitter's information, the latter has guaranteed that the former will have to try that little bit harder to get useful results from infrequent users — as well as reserved the possibility that Twitter can launch their own version.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.