Counterparties: The social network that’s three times larger than Facebook

By Felix Salmon
October 12, 2012

Welcome to the Counterparties email. The sign-up page is here, it’s just a matter of checking a box if you’re already registered on the Reuters website. Send suggestions, story tips and complaints to

If you’re reading the Web version of today’s Counterparties email, there’s a good chance you got it from somebody else. That is to say, someone likely put this post on the “social web” of platforms like Facebook, Twitter or, if you’re cooler, younger and snarkier than us, Reddit.

For Web media companies, the social web has become the fastest-growing, most-obsessed-over method of distribution at a time when the online ad market is shifting away from display ads to “native advertising” and sponsored posts from advertisers. BuzzFeed put the rise of social media in chart form: For BuzzFeed and its 200 or so partners, more traffic is now coming from Facebook than Google.

But Alexis Madrigal has a fascinating new piece on why we’ve gotten the social web wrong. Madrigal argues that today’s web analytics programs miss the most common way we share stories. The largest social network, Madrigal writes, isn’t Facebook – it’s people sending things to each other directly (likely by email or IM). This is what he calls “dark social”: the articles and links you’re navigating to directly and not getting from a social networking site, or finding on some other web page.

Looking at data from the clients of the analytics firm Chartbeat, Madrigal found almost 69% of social web referrals were so-called dark referrals. Facebook accounted for 20% of social referrals from Chartbeat’s clients; Twitter referrals made up just 6%.

What does this mean for media companies? For one, it suggests that Facebook, which has been fighting to convince big corporations and small businesses that it’s the center of all social activity on the Web, isn’t our main way of sharing content. And, as Madrigal suggests, it means that there’s no real way to trick the world into sharing your stories, no matter how many rules you come up with or tweets you send in capital letters. “The only real way to optimize for social spread is in the nature of the content itself,” Madrigal writes. Quality matters. How refreshing. — Ryan McCarthy

On to today’s links:

The Fed
Why QE3 is a “masterstroke of market manipulation” by Bernanke – Quartz

New Normal
Economists to nation: Get used to 7% unemployment – WSJ

Wow. Just Wow.
Unmasking Reddit’s Violentacrez, the biggest troll on the web – Adrian Chen

EU Mess
The European Union wins the Nobel Peace Prize, despite record unemployment – NYT
How Switzerland is manipulating its currency and hurting the euro zone – Vox EU

The final word on Mitt Romney’s tax plan: It was “plucked out of thin air for political reasons without regard to whether it was feasible” – Josh Barro

How going over the fiscal cliff will discourage people from working – WaPo

JPMorgan reports record profits – JPMorgan

Why are Indians getting poorer? – WSJ

Advice to publishers: “Atomize everything” – Matt McAlister

Twitter’s CEO: Our company is “gritty like the city” – All Things D



We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see

Swiss nominal GDP seems to be up about 3% in the last two years. It seems hard to argue from that that their management of their currency has been overly stimulative.

Posted by dWj | Report as abusive

About this –

“The Fed
Why QE3 is a “masterstroke of market manipulation” by Bernanke – Quartz”

Can’t read it – bet the millions of FS readers who’ve clicked-thru have fried poor little Quartz’ poor little server into smoking rubble, but that’s just surmise on my part. Not sure “market manipulation” is quite the right term, though. ‘Bait & Switch’ or ‘Wolf in Sheeps’ Clothing’ or ‘Trojan Horse’ are closer, but not quite right either to describe this particular species of oh-so-grand larceny.

Think about it – If Benny had declared that he was gonna print-up a Trillion$ and use the funny-money to bail-out his soul brothers/paymasters on The Street by taking the toxic trash off their balance sheets at rich prices – well, I wouldn’t have wanted to be the underwriter on his life insurance in that situation. By dressing-up this tar baby in a cloak of “stimulating consumption and investment”, he’s effectively bought himself a bullet-proof vest – and an entre to pick the pockets of every saver in US, and many abroad too. Nobody ever said Benny and the crew he serves aren’t clever and cunning as vipers, and just as dangerous.

Ever see on Discovery Channel what happens if you try to separate a mother polar bear from one of her cubs? Separating Benny and his boys from the information about who sold what to the Fed, at what prices, at a book-gain or loss and whether the sale was ‘with recourse’ or ‘as is’ – that will be like tryin’ to take on mamma polar bear, naked and unarmed. Which brings us to our multiple-choice quiz for the weekend – What’s the best way to wring this info out of Benny? – choose one only from the following:

a)Hold a cocked and loaded .45 to his temple until he comes across?

b)Kidnap one (or more) of his grandchildren until he puts out the data?

c)Get court order directing him to disclose the information?

d)Out-bid The Street and just buy the damned data?

e)Lull him into relaxation by offering bagels and gefiltefish and steal the info while he’s stuffing his fat, bearded-face?

Posted by MrRFox | Report as abusive

ha ha, kidnap his children or feed him gefilte fish. Because he’s Jewish, get it? Oh so clever

Posted by johnhhaskell | Report as abusive

@JohnH – you rascal, you only get one choice, and you’ve alluded to both b) and e). What to do? Exercising the discretionary authority usurped by me, I declare that you will registered as having selected the latter – my personal favorite too. Well done, lad.

Posted by MrRFox | Report as abusive

“But Alexis Madrigal has a fascinating new piece on why we’ve gotten the social web wrong. ”

By “we” I assume you mean “you,” since this would be obvious to anyone who isn’t in marketing.

Posted by Moopheus | Report as abusive