Friendster, MySpace and Facebook all had strong network effects but only one became the dominant network.

All had strong network effects, but they did it in different ways. MySpace was strong because of the level of personalization and the music shared on MySpace, but very few people were well-positioned to maintain high quality inputs to maintain long-term networks. Friendster couldn't scale its technology and made it too difficult for friends to stay connected in any meaningful way. Facebook concentrated on scalability while providing more and more ways for people to stay connected (messages, chat, ecommerce).

If you're going to build strong network effects, there has to be a core of devoted and popular users who are willing to use and broadcast on the social network. There also has to be a residual value proposition for people to follow that core or the activity on the social network. And the network itself needs to continue to evolve so that people can continue to maintain strong and varied connections over time.

Answered 8 years ago

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