Monetizing identity I think will eventually occur when people realize that their influence is a tradeable commodity that can be redeemed via affiliate marketing. But that also requires that we have frictionless markets, where the tracking of recommendations to sales is easy enough for your mom and my mom to participate– not the hodge-podge of affiliate networks we have now, with a near undecipherable system. Meanwhile, there’s selling your soul for ad dollars, such as Magpie tweets on twitter, pay-per-post, and banner ads hawking diet pills.

Seems like the younger folks are, the less they care about privacy– most college kids use Facebook as their address book. And the power.com vs. Facebook legal battle is especially interesting, since Facebook wants to block Power.com from allowing users to share their data– yet Facebook wants users to import all their contacts into Facebook and syndicate the other way. People have had fear of Big Brother watching us. Guess what– we’re doing it to ourselves willingly.

As for Facebook, I really do hope they figure out some way to have Google-esque success, but I don’t think paid subscriptions will get them there (and I think they know that). If they continue with their current strategy and work to own the way people control their identity online, then there’s definitely value to be captured, I just don’t think anyone knows how to monetize identity yet.

Really interesting and food for thought.

Jim