I don't know the economics terminology, but perhaps average people are just decent at exploiting opportunity? In this study a third party paid out the second-lowest amount to the bidders who bid the lowest amounts in return for deactivation. While no one competitor platform does everything of what Facebook's apps do, there are plenty of competitors they could make use of instead to replace particular single features or utilities of Facebook. The auction then becomes a game to bid an amount that's high as possible, yet still the lowest among the bidders, to actually win the bet. And instead, if Facebook raised prices from $0 to $1000 overnight, people would quit in droves, for the same reason: because dozens of comparable offerings exists at low or no cost that can take over subsets of the functionality in people's lives.
Given that airline overbookings use the same scheme to decide who flies and who gets paid and bumped to a certain, yet hazy-on-details future flight, perhaps this study simply tests humans' secret bidding strategies much more so than it tests the value people place on Facebook's utility.
One way to continue along this line of research would be to make people bid on giving up a much larger selection of social media services, with the exception of one, which would be their choice. They'd have to name their choice to keep. A second auction would then encourage them to name their price to give up that last one as well.
The optimal strategy in a second-price auction is to bid the true amount you're willing to pay (or be paid, in this case).
You can show that bidding higher or lower than this amount is dominated by bidding the true amount. If you bid higher than your true amount, this can only hurt you: You won't get any more money to stop using Facebook, because if you win, you get the second-lowest bidder's bid amount. It only makes a difference if you increase your bid too far, and lose the auction.
If you bid lower than your true amount, you might win when you otherwise would not have won... but you underbid! You're not getting enough money to compensate you for the loss of Facebook.
But given the lack of information, a person might reasonably try to make educated guessed about other people's bids. And often enough there's not one price a person has, it's more of a range. The combination complicates the thought process: A person might think anything over $100 would put them out of the running, but is willing to accept as little as $60. Their goal is to maximize their price within that range. Then it's not as simple as choosing your "true" price, the thought process is about choosing the highest price within your range that you believe is less than someone else's. I guess you might say any price within the range is a "true" price, but it does complicate the optimal strategy to include a bit more thought than just a single value.
If I'm willing to accept as little as $60, then I should bid $60. If someone else bids $1000, then I get $1000. I don't do any better by anticipating their bid and inflating my own bid to $999. If they bid $61, I get $61, and because I value not-having-Facebook at $60, that means I get $1 of surplus value.
Anyone bidding higher than their minimum price doesn't fully understand the second-price auction. Probably lots of people don't understand it, which could lead to inflated bids. (but that doesn't mean you, knowing better, should inflate your own bid!)
> dozens of comparable offerings exists at low or no cost that can take over subsets of the functionality in people's lives.
This is exactly what the study is designed to measure. If this was indeed true, exactly how much money are users's willing to pay to keep Facebook even when they have other free alternatives available? If that amount is greater than zero that tells you that Facebook is valuable to those people beyond the cost they are currently paying for it.
"there are plenty of competitors they could make use of instead to replace particular single features or utilities of Facebook. "
" because dozens of comparable offerings exists at low or no cost that can take over subsets of the functionality in people's lives."
No, the value is in the network, not the 'feature'.
You can't go 'somewhere else' because 'nobody is there'.
This is not like Craigslist so much, the network externalizations for FB are everything.
The only way to break it would be to follow the same type of path FB did: Harvard -> Ivy League -> College -> USA -> World -> all ages.
A network could start say among some specific group wherein it was possible to achieve a critical mass, and move on from there.
So say you started where there was a specific need, like bands in LA trying to get the word out to gigs, among those that like to go to such things. And then it spread to other cities for music scene gigs, then for other kinds of entertainment, then more broadly into a social network. And you could call it 'myspace'. :)
Many people can and do go elsewhere, because an individual can have presence on multiple platforms. And while one's social graph in different platforms looks different and is missing some people they know, the network is both self-healing and self-fulfilling, in that it can be reasonably assumed that strong connections can survive irrespective of the network, while weak connections may not, and all connections that didn't survive will be retroactively redefined in one's mind as weak.
It's not like people genuinely use Facebook to discover brand new individuals (as opposed to bands or groups), whereas they'd frequently do that on Instagram, Twitter, or Tumblr. And for interests and activities like music discovery, live music, celebrity fandom, neighborhood activities, and classifieds, other viable alternatives do exist, even if they aren't packaged alongside a rolodex of all the people you went to college with, or your vacation photos, or some isometric farming simulator you used to play 8 years ago.
A critical mass of individuals in most people's lives, and a critical mass of activities and group pages are on FB, to the point wherein most won't give it up for that reason alone; "I'd miss out on old friends or not be able to contact them, also, my kid's school and local playhouse are on there" - is a common refrain.
In those terms - there is no substitute for FB.
As far as your view of how people view relationships - the reason I don't buy it, is because of the simple fact: most people are not quitting FB. Keeping their account costs little, and enables those 'weak' relationships. So they will stay. And FB has the critical mass.
There is no substitute, at least in 2018. Really the only choice is turning it off which I think will happen, gradually.
Given that airline overbookings use the same scheme to decide who flies and who gets paid and bumped to a certain, yet hazy-on-details future flight, perhaps this study simply tests humans' secret bidding strategies much more so than it tests the value people place on Facebook's utility.
One way to continue along this line of research would be to make people bid on giving up a much larger selection of social media services, with the exception of one, which would be their choice. They'd have to name their choice to keep. A second auction would then encourage them to name their price to give up that last one as well.