Companies like Facebook, Twitter and Youtube have provided a platform on which their users can share content with other users. In turn, the platforms save the data of all interactions on their platforms sell this to advertisers. No matter how hard you worked on specific content, you will see little to no return for your input and the platforms profit from the value you’ve created. According to the founders of Steem, this needs to change. On their social media blockchain applications you can earn cryptocurrency with your content. Another revolutionary idea of Steem is that their social media platforms are completely decentralised. There is no central authority that censors content and storage, or sells user data to targeted advertising. The users decide how the platform will be used, look like and most importantly: what content is valuable.
The Steem Blockchain
The Steem blockchain allows the creation of social media platforms on which creators of content are directly rewarded for their effort. This is made possible by a social media economy in which people are rewarded for the creation of content. Moreover, participation such as liking, sharing and upvoting will earn users micro-rewards as well. People can directly transfer minor rewards in Steem currency to the creator of a specific piece of content out of appreciation.
You’re first response is probably: why would people pay for content if they have access to an almost unlimited supply of free content on other platforms. Let’s look at the first social media platform built on the Steem blockchain, Steemit. On Steemit, creators of appreciated content are rewarded when their work gets upvoted by others. In turn, the people who upvoted content that turns out to be valued by a large group of Steemit users, are rewarded as well. Additionally, people that leave useful comments are also rewarded. So, you are rewarded for creating appreciated content and for actively engaging on the Steemit platform. Users are rewarded in Steem, Steem Power and in Steem Dollars. Click here for a detailed explanation of Steemit’s dynamics.
Besides the Steemit platform, Steem is trying to compete with other types of social media platforms as well. As a competitor to Instagram, Steem has created Photosteem. SteemQ is a video sharing platform built on the Steem blockchain that will try to gain some of Youtube’s market share. Both of these new platforms employ the same model as Steemit. Since Steem is open source and they have announced that they will support new applications, we’re likely to see more Steem platforms pop up in the future.
There are no advertisers and no overhead costs which have to covered by its users on Steem’s social media platforms. This in contrast to Youtube for example, where you can monetize your video but only receive are a small fraction of the total advertising revenue. From your profits, Youtube’s overhead costs like buildings, salaries, and R&D are subtracted. And although advertising is not banned from Steem, the platform hasn’t seen much in this respect. Early adopters of Steemit are hesitant to see Steem fall in the hands of sponsored content. Since all Steem platforms are decentralised, the users are the ones who ultimately decide the dynamics of the platform.
The Steem team
Steem was founded by Ned Scott and Daniel Larimer. They have been out in the open on social media to share their vision and creation and have been doing so quite convincingly. The CEO and founder of Steem, Ned Scott, graduated in 2012 and after three years of food industry analyses, he decided to try and disrupt the current social media model. It seems like he struck jackpot with his co-founder Daniel Larimer, a successful serial entrepreneur, early Bitcoin adapter, software engineer and praised programmer. Before Daniel created Steemit, he founded Bitshares, a successful decentralised exchange for all kinds of digital assets. After he created the Steem blockchain and it was up and running, he resigned (March 2017) and decided to work on his new project, the Ethereum competitor EOS.
The founders have been able to attract talented developers with their revolutionary idea and have a 5 men strong development team. But Steem has a unique strength which lies within its community. The number of Steemit users is growing daily and a community with a strong sense of belonging has blossomed. Everyday, community members suggest or even develop improvements for Steem and Steemit and they are rewarded for this by the Steemit community, in social status and in Steem cryptocurrency. Just look at the responses and value given to this post by Steemit’s team.
Steem is going up against two of the most influential and successful companies of our time: Facebook and Google (Youtube). This is an extremely difficult task and most companies that have tried this have either been acquired or outcompeted. A major advantage of Steem’s social media platforms is that because it is decentralised, they cannot be bought. The platforms are owned and controlled by its users, and buying the platform would mean buying all the cryptocurrency, which would make them worthless as the users would instantly move away from the platform. Currently, outcompeting Steemit would mean that Facebook would have to change their entire business model which simply can’t be done overnight. In this regard, Steem seems to have a major competitive advantage over Facebook.
There are other blockchain-based social media platforms on the rise which could prove to be more of a threat. Platforms like Synereo, AdzBuzz and Akasha are going after Steemit by employing the same decentralised, rewards-for-value approach . Steemit has a major first-mover advantage and at the moment of writing Steemit has over 400,000 users. Nonetheless, there are numerous examples of early entrants getting outcompeted by later entrants (just think of Yahoo and MySpace). For now, Steemit is in the lead and is growing faster than any of its direct competitors, but time will tell if this is enough for them to remain the market leader.
How to buy and store Steem
The Steem cryptocurrency can be bought on Bittrex, Poloniex, Livecoin, Blocktrades and OpenLedger DEX. Instead of buying Steem, you can also try and earn Steem by sharing valuable content and actively engaging with content of others on the Steemit platform. You’ll receive your first Steem Power when you’re opening your Steemit account. Steem Power is different from Steem as it’s locked in for a period of 2 years. The Steem team has done this to reduce the effect of speculators on the value of content and engagement. Steem can be stored on both android and iOS devices by installing their app, on every computer using their wallet and on your Steem and Steemit account.
Steem is trying to disrupt an industry in which some of the biggest companies in the world are active. They have a business model that has the ability to do this, however, it’s highly uncertain if people will adopt their platforms. Even though a platform like Steemit is democratic and provides an opportunity to get rewarded for valuable content, it remains extremely difficult to change a global paradigm. Also, the platform is quite difficult to understand for new entrants and the interface isn’t nearly as smooth as those of Facebook and Youtube. Nonetheless, the Steem community is actively spreading the word and motivated to help Steem grow in every possible way. Once Steem’s different social media platforms reach an exponential growth factor, things can become very interesting. Like any social network, it’s all depended on (electronic) word-of-mouth and the number of new Steem users will be the best indicator of its future value and success.