4 ms·
There is a network effect to consider, too. The initial group may require $1k, but the asking price would likely drop as the remaining number of users does.
by berbec 8y ago
There is a network effect to consider, too. The initial group may require $1k, but the asking price would likely drop as the remaining number of users does.
- kazinator 8y agoObviously each little act of "stop using it" lowers the value of Facebook. If nobody uses Facebook, it has no value. This is supposed to be a tool to estimate the value, not to get everyone to stop using Facebook: how much do we need to pay a given user to stop using Facebook, provided that nobody else stops using Facebook? If we put a thermometer on every cubic millimeter of an object, we will probably significantly affect its temperature; but we don't do that; we use one small thermometer against a much larger object, so the transfer of heat between the two has a negligible effect on the temperature.
- jeromebaek 8y agoThis is still misleading. The value of Facebook to a given user u_k is a function of the value of Facebook to all users u_i, or at least the set of users that are u_k's friends. So the value function has a recurrence relation. This is why it is disingenuous to say the value of Facebook is a simple linear sum of value per user for every user; it is in fact highly nonlinear.
- JadeNB 8y ago> This is why it is disingenuous to say the value of Facebook is a simple linear sum of value per user for every user But neither berbec nor kazinator said, or even seemed to imply, that ….
- berbec 8y agoTo clarify - I imagine it's more subtle than a constant slope. I imagine the value per user stays steady for a while then the starts dropping quickly.
- itronitron 8y ago>> If nobody uses Facebook, it has no value. I wish that were true, but if everyone stopped using Facebook they could still build shadow profiles for everyone, as they do for people that do not have accounts, and they could just sell this data out.
- chii 8y agowhy would those shadow accounts be any useful (or accurate) if there's no active users to corroborate or contribute any information on them? Facebook's value is derived entirely from the information generated from its user base.
- robin_reala 8y agoFor everyone that’s not in the EU: GDPR puts a stop to that behaviour (theoretically at least - with a shadow profile there’s by default no consent collected, and it’d be difficult to argue legitimate interest).
- radiusvector 8y agoInterestingly, I see a pattern of a strong anti-network effect in play. Network effects are premised on the value of the network increasing in value as more users join. By definition then, the value of the network drops as people drop off. While the speed of adoption might always be > speed of deletion, there is certainly an auto-catalytic effect to people deleting FB, or not using/posting to FB as much.
- imh 8y agoThe initial group wouldn't even need $1k. The median bid here was closer to $100.