Video sharing is a key service on social media websites, and high-bandwidth networks are essential for these services to function properly. Qualman noted that while consumers may not understand megabits, they do understand that their video isn’t loading fast enough. And they may well use social medial channels to complain about the quality of their broadband service.

Fear of negative feedback can make businesses wary about embracing social media, says Qualman, but the smart companies understand that negative feedback can be turned on its head and used to their advantage. If a company can resolve a problem in a public forum, it can boost its reputation, and possibly even convert the complainant into one of its biggest fans.

Social media is not something businesses can avoid, he adds. People are out there talking about your company whether you like it or not. Social media has caused an important shift in power on the internet; now a single consumer can have a huge impact on brand and reputation. To illustrate the point, Qualman showed the following YouTube video:

There’s no doubt that social media is a force to be reckoned with. (If you still have doubts, then view this video). But the implications run deeper than that. Qualman’s take-home message is that social media has become an essential resource for business, and he has plenty of hard data to back up this claim.

For instance, Dell claims to have sold $3 million of computers using Twitter. Barack Obama used a social media campaign to raise $500 million in donations via social media websites; 92% of those donations were in increments of less than $100.

Further, research by Wetpaint/Altimeter found businesses that are fully engaged in social media significantly surpass their peers in both revenues and profits. The study also found companies with the highest levels of social media activity grew on average by +18%, while those with the least amount of social activity saw sales decline by 6%. To put that in context, only 18% of traditional TV advertising generates a positive return on investment.

Return on investment is only one aspect of social media, however. Qualman see the proper use of social media as an extension of good business ethics. Put simply, it’s about listening to your customers and then responding.

Social media affects every area of business, including marketing and PR, recruitment and new product ideas, sales and after-sales service. It can even work as a crisis management tool – when the plane landed on the Hudson River, the first anyone heard of it was when a photo update got posted on Twitter. That’s why it has to be fully integrated within the corporate culture.

Qualman encourages all businesses to take the plunge. “When you get into the social media space you’re going to make mistakes,” he says. “Get out there, fail fast and move forward. You don’t accomplish anything by sitting on the sidelines and watching.”

This article is a slightly expanded version of one that I wrote for the FTTH Council Europe. Please visit the “hot news” page of the FTTH Conference website for more reporting from Lisbon.