Hello
! Thanks for checking my Multiply Home out.
Yes, this is one more migration from social networking paradise to social networking paradise, as each gets gradually paved over, it gets populated by excessive riff raff and server quality turns to shit.
Free services are commons. Doesn't matter that you get pummelled by advertising, or whether the provider is selling information about you to business or government to make a buck. When a social network starts growing outside the US, the market value of information about a person in a much smaller/lower per capita GDP country is just nowhere near what a citizen of a G8 country is worth. Sorry to say, but its just true from a pure market perspective.
Hence as Friendster is inundated by girls in asia and micronesia, the servers are not being expanded to meet the demand because of the lower value of the user. As Orkut expands overseas, similar capacity vs revenue problems are arising, especially as Orkut rides on Google's servers, Google can find much higher value uses to put its servers to. Server farm growth doesn't keep up, and we have a tragedy of the commons, writ large, over and over again as new social network services arise.
The solution: a social network where users don't pay for themselves, but pay a set amount to invite new people in (they'd only get billed when the invitee accepts the invitation.) This would create a social network based on a 'pay it forward' model, containing only people that its users regard as high value persons (to them at least), and add a layer of filtration and discrimination that we have not properly seen even in the invite only social networks. A person without an invite can pay their own way into the network, and then start paying forward.
There might also be a method of paying via information exchange (see "The Festival" phenomenon in Charlie Stross' novel "Singularity Sky") such as market surveys, or work, such as technical support for the system, etc., to build up a 'bank' by which a person can spend the earnings on asking others to be a contact (the askee gets a cut of that payment) or inviting new network members.
On privacy of data: I really really dislike the degree to which we've lost info privacy and how things are getting more transparent. Not participating in social networks and other online fora is not going to help, though. From my work, I already know how much information there is in databases about each of us. Unless a "Fight Club" scenario were to be implemented, I really don't see it changing. All we can do is create case law to protect people from abuse of information.