15/11/2012 05:35 GMT | Updated 14/01/2013 05:12 GMT

Has Facebook Lost the Plot?

If you have a Facebook account, you've probably Liked at least a few brands and businesses. All of these companies continually jostle for valuable space in your news feed. And as the number of posts from businesses grows, the amount of 'noise' builds.

If you have a Facebook account, you've probably Liked at least a few brands and businesses. All of these companies continually jostle for valuable space in your news feed. And as the number of posts from businesses grows, the amount of 'noise' builds.

Facebook says it has the answer to all of that noise. It now reduces exposure for every business, and rewards high engagement with more exposure. In plain language, the more people who interact with a Page, the more that Page's internal Facebook score rises, and the more likely it is that the updates posted by the company will be seen.

That means small business Pages are at a distinct disadvantage, since they inherently attract less engagement. Users may well read a post, but they may not be motivated to Like or Share. As a result, small businesses can now expect around 15 per cent of their fans to see any given update. Suddenly, cultivating a Facebook following doesn't seem quite so vital.

If businesses want to increase their exposure - effectively elevating visibility to the same level it was before the new algorithm was introduced - they can Promote their posts. Promoted Posts are a paid tool that allow businesses to push more updates into more users' news feeds. Restoring visibility therefore means paying Facebook a fee each time promotion is required.

Businesses can scale up their exposure depending on the number of fans they want to reach. The cost involved is significant. If the Page has thousands of followers, you can expect each Promoted Post to cost hundreds of dollars. If you post several times a day, you'll need to pay for promotion over and over again. The costs quickly spiral. According to ReadWrite, Mark Cuban, owner of the Dallas Mavericks, reported that a single promoted post to a million followers would have cost him $3,000. And although Facebook will measure impressions for each post as proof that exposure has increased, but an impression is not a guarantee that a post was seen by a user. It's a sign that the user could have seen that post if they were in the right place at the right time.

Businesses are understandably looking for a way to game the system. By raising the Page's score, or Edge Rank, a business can decrease the cost of a Promoted Post. However, raising Edge Rank organically isn't particularly easy. In order to increase engagement, a business will probably need to Promote at least one post initially, since only 15 per cent of its fans are seeing its updates in the first place.

As an alternative, the company can artificially raise Edge Rank by gathering Likes, Shares and comments on posts - particularly images - therefore skewing Edge Rank in their favour and bringing costs down for Promoted Posts. This technique leads to an avalanche of 'empty' content which is specifically designed for viral sharing. It offers little in terms of value. It does nothing to promote the brand's own products, in most cases. It clutters users' news feeds with junk. It encourages unethical posting; topics chosen simply to 'trigger' Likes and Shares.

All of this is a mess. An expensive, confusing mess. Businesses feel like the rug has been pulled from under their feet. Without significant investment, nobody wins. While Facebook has no obligation to be free forever, the sheer cost of Promoted Posts is causing small businesses to be left behind.

It's an acute realisation of the philosophy behind, or ADN. Dalton Caldwell formulated the idea for ADN after following the monetisation of social media and accurately predicting a trend towards advertising and away from interaction. Caldwell noticed Twitter withdrawing third party access to its API, and soon realised that social media was on the verge of effectively downgrading the services offered for free, replacing those services with ads or fees. At the same time, social media sites gather gigabytes of content from each user, some of which they technically own.

Caldwell created ADN as an alternative to that model. It's a social network based on a paid subscription; a social network that promises never to sell personal data or content. And because it's a paid platform, it's remarkably uncluttered by spam.

ADN may only have 12,000 users, but that's still a significant number. It has attracted 12,000 people who are willing to sidestep mainstream sites like Facebook in favour of a more meaningful social experience. By paying for membership, ADN is more accountable and less likely to bring in sudden changes which disrupt the user experience. It's an interesting vision of the future: a social networking site where people pay for consistency and trust.

As for Facebook, a new wave of trading could push down its stock price further, and growing discontent from businesses doesn't bode well for its share price. David Spillane, Facebook's chief financial officer, dumped more than 60 per cent of his shares as soon as they expired from lock-up on 5th November. Sheryl Sandberg, COO, cashed in to the tune of $7.4 million last week.

The Dallas Mavericks have announced that they, along with Cuban's 70 other businesses, will be shifting their social media focus to Twitter, Tumblr and other platforms which don't yet charge a fee. These companies may be the first in a wave of businesses that vote with their feet.