TW: I am on Facebook, I like it. I do not post much there but it is interesting to see what my friends or more likely acquaintances are thinking about. Once one reaches a certain age we tend to exist within a bit of an echo chamber. But our acquaintances from years gone by tend to be more eclectic and diverse. For my generation which pre-dates email, internet and such being able to re-connect has been enriching.
Social networking though exhibits classic networking externalities and those externalities can work both ways as the piece illustrates. Here is to hoping FB retains its positive momentum.
From Economist:
"SOCIAL networking sites are, unsurprisingly, subject to network externalities—the value of participating in a network increases with the number of people on the network. The dynamics of network externalities have become very apparent with the growth of services like Facebook or Twitter. When just a few of your friends are on Twitter, the value you receive from the service may not be worth the hassle of setting up and maintaining account. But as the number of users grows, the benefit to being a part of the network increases, until it's actually costly not to join. With network externalities, we will tend to see positive feedback loops and tipping points.
We'll see that as sites grow to prominence, and we'll see it as they collapse in on themselves. Consider MySpace:
'Numbers released by web analytics firm Compete.com paint a terribly bleak picture for the future of MySpace. According to the Compete numbers, MySpace’s U.S. traffic dropped from 55.6 million unique visitors in August to 50.2 million in September. It has nearly shed off 20% of its U.S. traffic since June...'
MySpace’s downfall is accelerating. It lost a little over a million U.S. visitors between June and July, but more than 4 million between July and August and over 5 million between last month and this month.
The downward spiral is on. People are visiting MySpace less, which reduces its value as a social networking platform, which causes people to visit MySpace less.
Now, social networks are tricky things, and there are undoubtedly smaller sub-networks that are relatively isolated within the MySpace world. Declining use among other groups will not affect them as much, and the increasingly fringe character of the service may actually enhance its appeal among some users. In other words, MySpace probably won't shrink to nothing. But its days as a rival of other major social networking sites, like Facebook, are over..."
http://www.economist.com/blogs/freeexchange/2009/10/fun_with_network_effects.cfm
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