We heard that instead of giving Vanity URLs away for free, like it did last weekend, Facebook originally planned to auction them off to the highest bidder. Now a Facebook spokesperson tells us it’s true.
Facebook’s first idea was to auction them off in a standard “ascending” auction, where the URL and user name would have gone to highest bidder at the highest bid. The problem there was Facebook would have had to close millions of real-time auctions in a very short period of time, creating a tremendous load on its servers. Facebook also worried about giving wealthier users advantages over poorer ones.
To reduce that load, Facebook next thought about going with a Vickery auction — where interested parties submit one bid and the highest-bidder wins, but only pays a penny more than the second-highest bid. That idea was nixed as too complicated.
Facebook also told us that users it tested the auctions with gave them hard pushback on being asked to pay for Vanity URLs at all. The main point raised in feedback was that competitors like Twitter and MySpace already let users have URLs to correspond with their user names for free.