An interesting read at Business Insider that explains why we will keep using Foursquare and Facebook. The analogy is grocery store loyalty cards. We all know we share our shopping habits when we use them, still most choose to forgo privacy concerns in exchange to the savings
Check-in apps are rapidly becoming more focused on deals -- coupons and discounts that are only available to people using these services. Loopt CEO Sam Altman describes his new app as "a virtual loyalty card" for participating businesses.
That's a telling analogy. As Kevin Drum of Mother Jones recently pointed out, the effect of widespread loyalty cards in retail businesses -- supermarkets and pharmacies in particular -- has been the creation of a tiered pricing system. A universally adopted coupon system can't change the average price of goods, so the lower prices for participating customers are ultimately subsidized by higher prices for everyone else.
More recently, Groupon and its clones have created the same dynamic with services like massages and facials. There are now so many daily deals for these services that anyone who lives in a major city and pays full price for a massage is being lazy and financially irresponsible. As more of these businesses' traffic comes from deal sites, the 'nominal' price will essentially become an "idiot tax", subsidizing the prices everyone else pays.
The article doesn't even mention Facebook and the partnership they establish with e-commerce sites to share your relationship graph...