4 ms·

eBay was not in the first 10. First/Early mover is a very mixed bag with most of the example of "first/early" turning out to be "one that we remember now." Some

eBay was not in the first 10. First/Early mover is a very mixed bag with most of the example of "first/early" turning out to be "one that we remember now." Some other counter-examples: Palm (something like 47th PDA, well after the Newton for example), iPhone, MP3 player (iPod), Google, Microsoft (e.g. Excel, IE, Word, Powerpoint,...). See also NSF study http://www.nsf.gov/statistics/nsf04305/pdf/tab11a.pdf http://www.nsf.gov/statistics/nsf04305/pdf/tab11a.pdf (hat tip to http://particletree.com/notebook/first-mover-advantage/ http://particletree.com/notebook/first-mover-advantage/ )

davidw 18y ago
Search, and thus Google, obviously has different economics than something like eBay: it's very easy to switch to a new search engine, and there aren't really demand-side economies of scale like there are with auctions. eBay may not have been the first auction site, but it was the first to hit a critical size, beyond which the advantage was all theirs.
- skmurphy 18y ago
  Google makes money from selling ads. Advertisers want to place ads on the largest search engine sites (or one that can deliver a target audience at an effective price). It may be easy for a user to switch (although letting users know that you exist can be hard/expensive), it's less clear that advertisers will switch to a search engine with few users. Google's customers are the advertisers.
  - netcan 18y ago
    "Google's customers are the advertisers." Technically. They do a great job of monetising search traffic but that's not the bottleneck. Search engines win by attracting their customers' customers, users. Advertisers will follow the users.
    - skmurphy 18y ago
      Advertisers pay for a well characterized audience (which Google infers from the search terms). Who is in the audience matters quite a bit, which is one point of attack on Google: when you only have 1% (or .01%) of their audience share starting out, you are better served if that 1% represents a significant fraction of a particular market or type of buyer instead of a representative cross section of Google's total audience. That's also a potential point of attack on eBay: you have to take a niche approach. This is often a more reliable way to gain traction than "first/early" or "get big fast." Even better if the niche is initially non-customers or customers whom existing players don't find attractive so that are less likely to mount a competitive response.
      - netcan 18y ago
        True. From the perspective of most advertisers, they only care about their niche. If you your search engine or auction site is the place to go for tradesmen (plumbers, electricians etc.) or some other big money niche, you'd be able to make a lot more then you would with a much larger all purpose engine.
netcan 18y ago
First/Early mover, is (I think) a more useful concept from the market perceptive then the technology perspective. eBay was the winner that emerged from the first tussle and as said above it was the first to hit a certain size. You might not want to call it a first mover but that is a semantic discussion. From the perspective of the market, it was. The iphone certainly is a late entrant any way you slice the market. Late mover doesn't necessarily mean loser though. Palm was a late entrant. I think what you get in that case is that the market had a few false starts. In that case, moving early would have been a mistake as the market didn't take off. You could argue that the ipod was a first mover from a marketing perspective. The idea is that the product (in the minds of users) is so different that it is essentially a different market. grey area But some areas definitely favour early movers. Interestingly, I don't think viaweb was one of them. You have a very large choice of online shop building software these days. There is not too much advantage in choosing the same software as everyone else. But I guess that wouldn't have been obvious at that point. Things could have rolled out differently though 'Web malls' could have happened. In that case, being in early would have been a big deal. Cheers for the link. Is there analysis that goes with it?
- skmurphy 18y ago
  The short analysis: first/early is a factor but not dominant. Each of the examples I cited would be "first/early" in the popular perspective. iPhone may end up re-defining the category the way that Palm and iPod did: from a marketing perspective "whole product" is a more useful target than "first/early mover."

davidw 18y ago

Search, and thus Google, obviously has different economics than something like eBay: it's very easy to switch to a new search engine, and there aren't really demand-side economies of scale like there are with auctions. eBay may not have been the first auction site, but it was the first to hit a critical size, beyond which the advantage was all theirs.

skmurphy 18y ago
Google makes money from selling ads. Advertisers want to place ads on the largest search engine sites (or one that can deliver a target audience at an effective price). It may be easy for a user to switch (although letting users know that you exist can be hard/expensive), it's less clear that advertisers will switch to a search engine with few users. Google's customers are the advertisers.
- netcan 18y ago
  "Google's customers are the advertisers." Technically. They do a great job of monetising search traffic but that's not the bottleneck. Search engines win by attracting their customers' customers, users. Advertisers will follow the users.
  - skmurphy 18y ago
    Advertisers pay for a well characterized audience (which Google infers from the search terms). Who is in the audience matters quite a bit, which is one point of attack on Google: when you only have 1% (or .01%) of their audience share starting out, you are better served if that 1% represents a significant fraction of a particular market or type of buyer instead of a representative cross section of Google's total audience. That's also a potential point of attack on eBay: you have to take a niche approach. This is often a more reliable way to gain traction than "first/early" or "get big fast." Even better if the niche is initially non-customers or customers whom existing players don't find attractive so that are less likely to mount a competitive response.
    - netcan 18y ago
      True. From the perspective of most advertisers, they only care about their niche. If you your search engine or auction site is the place to go for tradesmen (plumbers, electricians etc.) or some other big money niche, you'd be able to make a lot more then you would with a much larger all purpose engine.

netcan 18y ago

First/Early mover, is (I think) a more useful concept from the market perceptive then the technology perspective. eBay was the winner that emerged from the first tussle and as said above it was the first to hit a certain size. You might not want to call it a first mover but that is a semantic discussion. From the perspective of the market, it was. The iphone certainly is a late entrant any way you slice the market. Late mover doesn't necessarily mean loser though. Palm was a late entrant. I think what you get in that case is that the market had a few false starts. In that case, moving early would have been a mistake as the market didn't take off. You could argue that the ipod was a first mover from a marketing perspective. The idea is that the product (in the minds of users) is so different that it is essentially a different market. grey area But some areas definitely favour early movers. Interestingly, I don't think viaweb was one of them. You have a very large choice of online shop building software these days. There is not too much advantage in choosing the same software as everyone else. But I guess that wouldn't have been obvious at that point. Things could have rolled out differently though 'Web malls' could have happened. In that case, being in early would have been a big deal. Cheers for the link. Is there analysis that goes with it?

skmurphy 18y ago
The short analysis: first/early is a factor but not dominant. Each of the examples I cited would be "first/early" in the popular perspective. iPhone may end up re-defining the category the way that Palm and iPod did: from a marketing perspective "whole product" is a more useful target than "first/early mover."