Where's My Piece of the Facebook Ad Pie?

So Facebook finally announced its advertising strategy today, dubbed Social Ads. Here are the basics as per Saul Hansell of The New York Times:

"Facebook now will give advertisers the ability to create their own profile pages on its system that will let users identify themselves as fans of a product. Each user's news feed will contain items like "Bobby Smith is now a fan of Toyota Prius."

News feeds can be linked to outside Web sites as well, so users can tell friends about what they rented at Blockbuster or are auctioning on eBay.

Facebook will offer all of those features to advertisers free. What it will charge for, however, is appending an advertisement to these news items. Toyota could buy the right to put a photo and a short message under every news-feed post that links to the Prius.

In addition, Friends of Bobby, to continue this example, will see banner ads for Toyota throughout Facebook's site. At the top of each of these ads will be a photo of Bobby and the fact that he likes the Prius."

Let me get this straight. Facebook gets paid every time one of its users goes through the act of signing up as a "fan" of a company's product, and then that company can serve ads to the user's friends based on this information.

While we inadvertently serve as walking ads all of the time when we use our iPhone, BlackBerry, drink Starbucks, or run in our Nike's, this is almost always because we derive some utility from the act.

What's the incentive for me to say I'm a fan of Blockbuster (one of the initial advertisers) and how would you view somebody who said they're into Diet Coke (another initial advertiser)?

I could see this working for an unknown company like the Netflix of three or four years ago when it became cool to be a Netflix evangelist. But those types of companies are few and far between.

The obvious solution seems to be for Facebook and/or the advertiser to give "fans" a piece of the ad pie, but this is still likely to be fraught with fraud.

In the end, I'm not sold on this first version of Social Ads.

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