Cost to walk away from Facebook for a year? More than $1,000, new study finds

Cost to walk away from Facebook for a year? More than $1,000, new study finds
Facebook app on phone. Credit: CCO

How valuable is Facebook to its users, and how can you measure the value of the site when access is free? Three economists and a social media researcher pooled their work and expertise to assess Facebook's value to its users, in contrast to its market value or its contribution to gross domestic product.

Using a series of auctions—in which people were actually paid to close their accounts for as little as one day or as long as one year—the researchers found that Facebook users would require an average of more than $1,000 to deactivate their account for one year. The study is published today in PLOS ONE.

Facebook, with more than two billion global users, is among the social media websites that provide access at no cost, so the auctions created by the research team posed the question in reverse: What amount of money would you require to give up your Facebook account for some fixed period of time, ranging from one day to one year?

"Social media, and the internet more broadly, have changed the way we live and the way we keep in touch with friends and family, but it's hard to find evidence that the internet has made us richer or more productive at work. We know people must derive tremendous value from Facebook or they wouldn't spend millions of hours on the site every day. The challenge is how to put a dollar value on a service people don't pay for," said first author Jay Corrigan, professor of economics at Kenyon College, who has done a number of studies involving experimental auctions.

The work began as independent efforts by two teams: Saleem Alhabash at Michigan State University and Sean B. Cash at Tufts University; and Corrigan at Kenyon College with Matthew Rousu of Susquehanna University, so the auctions had slightly different designs and advantages.

In total, the researchers ran three actual auctions, including two samples of college students, a community sample, and an online sample. Winners were paid upon proof that their membership was deactivated for the set period of time. Auction details as follows.

  • Auction one: 122 students at a Midwestern college. The average bid for deactivating Facebook for one day was $4.17; for three days, $13.89; and for one week, $37.00. To calculate a one-year estimate, the researchers annualized this data, which showed a range of $1,511 to $1,908.
  • Auction two: 133 students and 138 adults from a large Midwestern university/town. The average bid to deactivate Facebook for one year in the student group was $2,076 while the average bid in the community group was $1,139.
  • Auction three: 931 adults (mean age: 33) within the U.S. obtained using the Amazon Mechanical Turk open marketplace. The average bid to deactivate for one year in this sample was $1,921.

"Auction participants faced real financial consequences, so had an incentive to seriously consider what compensation they would want to close their accounts for a set period of time and to bid truthfully," said last and corresponding author Sean B. Cash, economist and the Bergstrom Foundation Professor at the Friedman School of Nutrition Science and Policy at Tufts University in Boston. "Students placed a higher value on Facebook than community members. A number of participants refused to bid at all, suggesting that deactivating Facebook for a year was not a welcome possibility."

The study contrasts the company's market capitalization with the value placed on it by its users. For example, based on a market valuation of approximately $420 billion, and about 2.2 billion users, the of Facebook would be approximately $190 per user, or less than one-fourth of the annual average value of Facebook access from any of the samples.

"While the measurable impact Facebook and other free online services have on the economy may be small, our results show that the benefits these services provide for their users are large," wrote the authors. The authors also noted that Facebook remains the top social networking site in the world and the third most visited site on the Internet, after Google and YouTube, despite market fluctuations and controversies.

The study noted that the convenience samples, somewhat skewed toward students, are not necessarily representative of all Facebook users, but that there was consistency in price valuation by users across the samples and across different timeframes.


Explore further

Facebook back up after Americas service interruption

More information: Corrigan, J.R., Alhabash, S., Rousu M., Cash, S.B. (Dec. 19, 2018). How much is social media worth? Estimating the value of Facebook by paying users to stop using it. PLoS ONE. doi.org/10.1371/journal.pone.0207101
Journal information: PLoS ONE

Provided by Tufts University
Citation: Cost to walk away from Facebook for a year? More than $1,000, new study finds (2018, December 19) retrieved 24 June 2019 from https://phys.org/news/2018-12-facebook-year.html
This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no part may be reproduced without the written permission. The content is provided for information purposes only.
247 shares

Feedback to editors

User comments

Dec 19, 2018
Are you kidding?!
The main question is "How much individual users must get paid, because at the end it is their data which makes Money for FB"

Dec 19, 2018
Nobody ever gave me $1000 for being on Facebook. I cancelled my account and refused any further communication a year ago, and AFAICT it didn't cost $10, much less $1000.

Dec 19, 2018
Even better
Da Schneib> Nobody ever gave me $1000 for being on Facebook. I cancelled my account and refused any further communication a year ago, and AFAICT it didn't cost $10, much less $1000.

As facebook is hardly used by a large majority of people
it is kept open
as long as facebook never charges a monthly fee
as there are occasions with family and friends it is useful
the instant facebook charges a monthly fee
Its membership will plummet like a stone

Dec 19, 2018
What a bizarre study. Facebook represents a negative value to its userbase. I never saw the point of it, it was a degradation of the Internet when it came out, and it's all that and more today.

Dec 19, 2018
They made it sound like opportunity cost. It is not.

This basically says that you could charge the common halfwit $80/mo

Ironically, facebook already determined that charging even $50/mo for add free pages would eliminate so many users the business would fail.

I would need to be paid at least a minimum wage just to pay attention to facebook...though shorting it would have been fun. I called it after that 20% drop. It may be bottoming out later this year and is testing the current bottom now.
It is funny how dumb people are....except it results in dumb rich people like trump

Dec 19, 2018
Facebook is churning out millions of idiotic Americans. They control EVERYTHING that you see, spoon-feeding exactly what THEY want you to view. What is so shocking is how billions of people have abdicated independent thought and the real "free Internet" where you could both express your opinion and read / view whatever you wanted in exchange for a tightly controlled platform called "social media". There is nothing "social" about it. It's mind control. Thought control. Advertising directly targeting every individual user. Invasion of personal privacy. Data collection. Paid advertising selling your personal details to unaccountable corporations. The breadth of this problem is staggering.

Facebook "owns" YOU be convincing its users to abandon the real Internet and free-flow of information. Once you join, you're hooked through dopamine hits via "likes" and comments to your posts and timeline. It's highly addictive and designed to be that way.

Dec 19, 2018
Your personality, habits, details and private life are slowly peeled back and given to unaccountable corporations with dubious motives. You're making them all rich with targeted advertising and detailed demographics. It's design alienates people from the real world and actually talking to one another by intention. The end result is people who have become totally incapacitated from discerning truth from fiction, reality from online fantasy, value and importance on real issues are watered down or made to seem as if your actual participation is "satisfied" by simply signing a stupid online petition or voting up a topic that you like.

These are not the actions of responsible, participating, ethical people - but billions have now gravitated to Facebook and other social media platforms, abandoning real researchers, journalists and websites that profit nothing from their efforts to share and convey news and information.

Dec 19, 2018
It's social "experiment" of the worst kind and has resulted in billions of people who have no real connection to the real world, they're desensitized, propagandized, and immune to important issues that need and required their actual real-life involvement. Finally, Facebook creates a terrifying "screen addiction" that has billions of people spending billions of hours staring at screens while ignoring and not participating in the real world.

It is my opinion that social media is an absolute disaster and yet here I am - staring at a screen. But I do make a strong effort to put this all into a limited context. What I read and do "online" is not real, has no meaning, accomplishes exactly NOTHING and changes exactly NOTHING.

Dec 19, 2018
IMO social media is the most plausible candidate for "the great filter". Who needs nuclear wars, pandemics or asteroid strikes?

Tailored content is creating a world of echo chambers where intelligence plummets like a stone. Why bother facing unpleasant facts or even those who disagree with you when you can surround yourself with like minded people and give yourself the false impression that the world is exactly like you want it to be. Progress be damned!

Dec 20, 2018
Having foregone Facebook for a week and so knowing its "miss" value is the question. What this research shows is only the "expected miss". People might find they did not miss it as much as they expected--or it was more valuable than they anticipated. This is the real value of facebook to its users.

Dec 20, 2018
To me Facebook is indispensable as I use it to check out events and gigs in my town and nearby towns. Without it I wouldn't have a clue what's going on and would become a hermit.
Likewise I see gigs and events my friends are going to (these are 'real' friends), usually I'll be interested too.
While I wouldn't pay to use the service (that would drive everyone off and it would become useless), I also wouldn't take any amount of money to close my account, I need it..
I rarely post anything and only check my feed for like 10 mins per week, I guess I'm not a typical fb user..

Dec 22, 2018
10 minutes per week and its indispensable?! Sad sad sad

Have you heard of phones, email or even (gasp) visiting friends?

Jan 05, 2019
Fake headline. What people would pay to keep it on does NOT equal a cost to turning it off. It is a "value" not a "cost."

Clickbait sucks. How can we trust regular news when even the science news is so poorly reported.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more