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I don't think Facebook will be dethroned by another Facebook. I also do not think the differentiator for such a new king is technological (e.g. P2P). The only k

I don't think Facebook will be dethroned by another Facebook. I also do not think the differentiator for such a new king is technological (e.g. P2P). The only kind of FB rival I can imagine succeeding is an open ecosystem one. A second FB would have to overcome the network effects, and the only chance for that to happen would be for FB's network effects to decrease. While negative network effects do occur -- it's what killed Orkut, for instance -- Facebook has learned that lesson well. FB's value for participants has decreased, but is now stable and that network is still a huge barrier for entry. Technology is largely irrelevant. People do not care if it's P2P, runs on functional code or if it is an engineering marvel. They care about the value provided to them. The article posits that P2P adds negative value, and it is probably right. The article infers from that to the impossibility of a FB killer, which I think is wrong, because the scope of the analysis is wrong. An open ecosystem social network: 1) Has the possibility of creating use cases that Facebook can't compete with; 2) May be extremely vibrant, if the ecosystem is large enough; 3) Can't be bought by Facebook, as it runs contrary to the main strategy of a walled garden. (It may be bought in order to be killed, though); 4) Can live perfectly well, for an indeterminate amount of time, in second place. I can't see any other avenue for Facebook's demise. Side note: Twitter nearly had these characteristics for a while. They squandered the opportunity when they kicked it's developer ecosystem in the nuts. Sad.

intended 10y ago
I think we've reached the stage where second order effects influence the discussion. So its not just a product which has to be killer, it has to be able to defeat facebooks increasing mass of capital. For that matter - lots of Facebook competitors HAVE been created. They've just been bought out by facebook or someone else. I suspect that eventually people will just die out of facebook, and at some point it will gain the moninker of gravebook. Once facebook stops being cool, it will stop gaining younger users and the network effect will end. Of course, people at FB have obviously considered this problem and have a plan for it. Perhaps they will live forever. Maybe we'll discover some first order effects of the network effect which limit its growth or even reverse its growth. Other than these 2 outcomes though, I don't think we have several degrees of freedom.
xiaoma 10y ago
In Asia, I see LINE, Viber, and WeChat displacing a huge chunk of facebook usage for a lot of people. The network effects are intensely strong, too.
jpetso 10y ago
It seems that the constraint "Can't be bought", or "Can't be bought to be shut down", is an important one and fundamentally incompatible with the goals of a VC-funded startup. That's also why Twitter failed in that respect. Potentially workable governance models to prevent this kind of takeover: - Community-driven open source - Bootstrapped company with limited profit ambition (think GitHub or Basecamp) - Non-profit/charity organization If you're a startup millionaire and care about the real-world viability of P2P, decentralization, etc., consider donating to / investing in one of these vehicles instead of looking for the next big business model. Any startup ever will sell out to centralization and control eventually, unless they specifically put themselves in a position where they don't control their own ecosystem anymore (having open-sourced the software and gained a large enough audience that can decide to fork if necessary).

intended 10y ago

I think we've reached the stage where second order effects influence the discussion. So its not just a product which has to be killer, it has to be able to defeat facebooks increasing mass of capital. For that matter - lots of Facebook competitors HAVE been created. They've just been bought out by facebook or someone else. I suspect that eventually people will just die out of facebook, and at some point it will gain the moninker of gravebook. Once facebook stops being cool, it will stop gaining younger users and the network effect will end. Of course, people at FB have obviously considered this problem and have a plan for it. Perhaps they will live forever. Maybe we'll discover some first order effects of the network effect which limit its growth or even reverse its growth. Other than these 2 outcomes though, I don't think we have several degrees of freedom.

xiaoma 10y ago

In Asia, I see LINE, Viber, and WeChat displacing a huge chunk of facebook usage for a lot of people. The network effects are intensely strong, too.

jpetso 10y ago

It seems that the constraint "Can't be bought", or "Can't be bought to be shut down", is an important one and fundamentally incompatible with the goals of a VC-funded startup. That's also why Twitter failed in that respect. Potentially workable governance models to prevent this kind of takeover: - Community-driven open source - Bootstrapped company with limited profit ambition (think GitHub or Basecamp) - Non-profit/charity organization If you're a startup millionaire and care about the real-world viability of P2P, decentralization, etc., consider donating to / investing in one of these vehicles instead of looking for the next big business model. Any startup ever will sell out to centralization and control eventually, unless they specifically put themselves in a position where they don't control their own ecosystem anymore (having open-sourced the software and gained a large enough audience that can decide to fork if necessary).