
Why Facebook Keeps Beating Every Rival: It’s the Network - mgav
https://www.nytimes.com/2017/04/19/technology/facebook-snapchat-instagram-innovation.html?ref=business
======
exelius
It's hard to build a customer base when Facebook can just come in, copy you,
and corner 95% of the market on the day they release.

This is the _exact same_ advantage that Microsoft had in the enterprise
market. Sure, competitors could release enterprise products and have some
success, but if Microsoft decided to copy you, they had an army of enterprise
sales agreements already in place and would eat 50% of the available market in
the first year. The network effects of their enterprise sales channel -- which
existed at nearly every company in the world thanks to the ubiquity of Office
documents -- made it very, very difficult to compete with them for a long
time.

Network effects are much stronger in the consumer space (mostly because the
consumers are poorly educated about their choices, and often have little
incentive to become informed). Which is why we're seeing Facebook eat the
world when it comes to consumer communication platforms.

~~~
ruleabidinguser
As with all things, this advantage will wither. I heard Milton Friedman once
say something along the lines "There has never once been a natural [not the
result of government action] monopoly that stayed a monopoly for very long."
People just need patience and faith in the free market.

~~~
gumby
Friedman simply made that assertion. I basically believe it, but like so many
things in Economics it's true in theory yet of limited value in practice.

First of all, on human timescales (i.e. lifetimes) monopolies can be very long
lived. The Standard Oil Trust was very destructive for decades, and though it
might have collapsed due to natural causes, that destruction could have lasted
for decades more. Which leads to the second problem: those long periods of
stagnation are multiply destructive: not only do the victims pay a premium
(which they could have spent on other goods), the monopoly's existence retards
innovation.

The final irony in the case of Standard Oil is that is was worth more to John
D Rockefeller after being broken up than it was when integrated. The
government did _everyone_ a service by breaking it up.

~~~
iopq
[https://en.wikipedia.org/wiki/Standard_Oil](https://en.wikipedia.org/wiki/Standard_Oil)

"In 1904, Standard controlled 91 percent of production and 85 percent of final
sales. Most of its output was kerosene, of which 55 percent was exported
around the world. After 1900 it did not try to force competitors out of
business by underpricing them... Due to competition from other firms, their
market share had gradually eroded to 70 percent by 1906 which was the year
when the antitrust case was filed against Standard, and down to 64 percent by
1911 when Standard was ordered broken up"

sounds like if you stop trying to compete other companies will

~~~
Spooky23
What do supposed compelled Mr. Rockefeller to choose to cease his practice of
driving competing companies out of business? Some sort of personal awakening?

~~~
adventured
No. They were fully conscious of their position, in terms of economic power
and monopoly. The Sherman Anti-trust Act was passed in 1890. They no doubt
believed they had accumulated enough of the market to sustain dominance, while
the overall pie continued to expand.

Rockefeller paid ransom sums for decades to buy out competitors (most of which
were junk operators at best) to keep them from tanking the price of oil by
dumping new strikes onto the market (a very frequent occurrence). His entire
goal was oriented at market share + stability. The history of oil prices back
then, was truly horrific, it was a constant boom and bust cycle that tortured
most companies in the oil sector. Once Standard Oil accumulated enough of the
market, including distribution (not as often talked about, they overwhelmingly
controlled distribution), it could heavily control market pricing without
having to own all the market. Their dominance in distribution is arguably the
single most important thing they accomplished after the refining
consolidation. With that gatekeeper status, they were able to demand other
firms they didn't own adhere to their pricing levels, or have their
distribution access cut off. In that way, they figured out how to stabilize
the market pricing, without having to continue to own ~90% of the refining
market.

------
WikipediasBad
This might not be a popular opinion here (so please reply too if you intend to
downvote me), and I might be biased because I just came back from F8 Dev
Conference yesterday, but I don't think the reason Facebook beats a lot of
rivals is network effects, it's because of Zuckerberg. He runs a very tight
but organized ship. Let's be real, before facebook and all this stuff, mySpace
had incredible amount of network effect and market share for those days, as
did friendster (for that era of technology). Twitter had a network effect
(albeit, an interest graph not a direct network of friends) and it is not
doing well at all, even in areas where interest graph network effects should
come in and dominate. You get my idea. I might be biased here because I got a
small few minutes to converse with Zuckerberg at F8, but I think calling
things simply "the network effect" and being done with it as to why facebook
is so successful is a bit disingenuous, it's network effect + right leadership
(aka Zuckerberg and to a lesser extent Sheryl). A lot of companies had network
effects before facebook and didn't manage their advantage properly. Mark seems
to be the overseer of all decisions at facebook and so far almost everything
(except for crushing Snap) has worked flawlessly. It remains to be seen what
happens with Snapchat.

~~~
a_imho
Facebook Work was marketed as the best thing since sliced bread but I yet to
see it making any waves for example.

~~~
lucasmullens
What company only has successes? Seems pointless to try to extrapolate from a
single failure.

~~~
parthdesai
Facebook has tried a lot to copy snapchat, even released atleast couple of
apps that i'm aware of but failed. Eventually they started to copy features of
snapchat in Instagram, Whatsapp, messenger and facebook app. Heck now you can
send snaps in Instagram. Not stories, snaps. that is fucked

------
Spooky23
The elephant in the room is... are people "switching" to Snapchat a thing? Is
Facebook winning a war that wasn't fought?

This sounds like somebody planted a seed of FUD about snapchat that ignores
what's a bigger question in my mind -- are the users who typically choose
Snapchat now choosing Facebook?

I don't believe alot of Facebook narratives. Most of the people in my social
circle count as part of their 1B messenger users, but all of their substantive
communication is happening on iMessage. When you have billions of users, it's
hard to make definitive statements about network effect, as even small
variations are big. Facebook's network effect doesn't seem to have as much
mojo as Microsoft or AOL did in the old days. Hell, AOL had millions of people
paying $20/mo for a decade for nothing.

Per Google, they have 1.86B monthly users. Per this article, Only 60% of
Facebook users use messenger, Only 1/3 of Facebook users use instagram, Only
1/3 of Instagram users use stories. That's pretty telling to me, especially
considering all of the ways they trick you to click on things and gin up the
numbers.

~~~
strangecyan
As I mentioned in another comment, joining Facebook is something that just
isn't a good idea for young people. The network that is praised as the primary
reason Facebook is successful in the article, does more damage to someone's
future than gives them benefit in the present. Schools and Colleges running
checks on Facebook for anything negative about them, finding one student and
following the network for other, has affected some of my friends. As has
employers and work experience checking Facebook. 'The Network' also means that
family are suggested to friend you almost immediately; I don't need to explain
the problems with that. Snapchat is a safe haven for creative, throw away
content that isn't indexable, searchable, doesn't have a social graph or a
permissions model.

~~~
hocuspocus
First, the idea of a school running checks on Facebook sounds pretty comical
to me. Your schools are definitely over-funded if they have the time and
resources for that. I went to a school that is the topic of several public
groups on Facebook, including a satirical web-comic that was run by a student
for many years.

But more importantly, do you realize nobody forces you to post or share
anything? And even if you do, it's very easy to restrict permissions to a few
selected circles. Your family members send friend requests? Fine, add them to
the "restricted" list. A lot of people (me included) have stopped using the
main newsfeed, and I notice that most of the picture sharing is done on
Instagram nowadays, but it's still a convenient tool, especially when you have
friends on every continent. And it's really not that hard to keep things
private.

------
strangecyan
The idea that Facebook has beaten Snapchat just because they've cloned
features is such a weird proposition to me.

Facebook's problem is not that they don't have features, it IS the network
that is stopping kids from signing up. Snapchat is a safe haven for creative,
throw away content that isn't indexable, searchable, doesn't have a social
graph or a permissions model.

~~~
ypeterholmes
Put differently, the truth is actually the opposite of what this article
argues: the vast size of Facebook's network is the biggest threat to their
existence. Many people I know are ditching facebook because its become too
large a social graph- why would I post something edgy to a network that
includes my parents?

~~~
CodeCube
I fully get that this feature just isn't surfaced very well ... But I don't
understand why this isn't facebook's biggest priority, to make their extremely
robust permissions system easier to use. As lame as it was in general, G+'s
"Circle" feature was really well thought out. I should be able to put all my
family in one group, my drinking buddies in another, and my coworkers in
another ... and then I can freely share whatever I want with whomever I want.

I've also had plenty of people _not trust_ the permissions. Like, posting
pictures from a party, people will freak out when I tag them ... and even when
I tell them that I've locked down the album permissions, they don't trust that
some error down the line won't expose everything.

~~~
smelendez
> I should be able to put all my family in one group, my drinking buddies in
> another, and my coworkers in another ... and then I can freely share
> whatever I want with whomever I want.

This is basically what people use private groups for. It feels more intuitive
than posting everything as a standard post with restricted permissions.

> I've also had plenty of people not trust the permissions. Like, posting
> pictures from a party, people will freak out when I tag them ... and even
> when I tell them that I've locked down the album permissions, they don't
> trust that some error down the line won't expose everything.

No offense, but they may also not trust that you've configured the permissions
correctly, or that your definition of "locked down" is one they think is
appropriate for the photo or will be appropriate for the photo in a year or
ten years.

~~~
CodeCube
> No offense, but they may also not trust that you've configured the
> permissions correctly, or that your definition of "locked down" is one they
> think is appropriate for the photo or will be appropriate for the photo in a
> year or ten years.

None taken, that's a good point ... upon reflection, I'd probably feel just as
hesitant about someone else doing the same thing.

------
quotemstr
It's also culture: Facebook is data-driven and experiment-happy in a way I
haven't seen at any other tech company. _Everyone_ at the company wants to
minimize red tape and heavyweight process, and it really shows in how quickly
Facebook can develop software and in how few developers they need to do it.
I've worked at Facebook; I've worked elsewhere. There are _real_ lessons
everyone else should be taking from FB's engineering culture.

Managers at other companies give lip service to developer velocity, but in the
end, they still end up creating the same kind of bureaucratic slowdowns that
have hobbled the industry for decades, mostly because they can't let go and
delegate real decision-making power to ICs. It's "Yes, we care, but _bullshit_
, so we need _process_ " over and over, stomping on the face of human
ingenuity forever. Facebook _means it_ when they say they care about developer
productivity and code velocity, and that should terrify everyone else.

~~~
SadWebDeveloper
what the f... does "culture" have to do with FB vs Snapchat. I get it, they
copied the functionality fast but only because it was a twist of what FB
already does not because FB-engies were the best in town but because it was
too easy.

~~~
askafriend
If you think it's easy then you haven't developed consumer applications at
that scale and quality before. It shows in how you dismiss the process.

There's copying and then there's _copying well_ and _fast_. Copying isn't bad
in and of itself - not at all.

~~~
SadWebDeveloper
I always cringe when a developer uses "scale" as intimidation tactic for why
"my code is better than your code" and if you believe that only a handful of
"facebook engineers" are the gods of scalability then you should probably
switch careers.

~~~
askafriend
No one said any of those things. And if you don't understand why scale matters
then you simply don't have experience with it. That's fine. I don't think
there's anything useful here for either of us to gain by continuing this
conversation though - you seem to have your mind made up and you're clearly
angry for seemingly no reason.

~~~
SadWebDeveloper
> No one said any of those things

>> If you think it's easy then you haven't developed consumer applications at
that scale and quality before >> And if you don't understand why scale matters
then you simply don't have experience with it.

 _cringe_

~~~
askafriend
1\. I didn't use scale as an intimidation tactic as you purport. Scale is one
engineering requirement that makes tasks either harder or more work than if it
weren't a requirement. Scale isn't only in terms of # of users or how much
hardware you need to support those users. Scale also refers to complexity of
product. When introducing a new feature, there are all of the considerations
you need to make in order to integrate that feature into the existing product
_system_. You seem to think both sides of scale are easy to execute
flawlessly, and that sentiment can only come from someone who hasn't worked
with these constraints before.

2\. You said that I think only a handful of Facebook engineers are the gods of
scalability. I never said this. I simply intended to give credit where credit
is due. They executed extremely well (in my opinion) and they deserve credit
(in my opinion). Also - engineers are not the only ones who help scale a
product through infrastructure. As I mentioned before, there is also _product
architecture_ that needs to be considered when introducing a new feature. The
larger question becomes _How does this new feature work to provide value in
the context of all of the other things that X does?_. For something as complex
as Facebook or Instagram, this is _hard_. A very simple example that
illustrates this is user education. It's far different when you have a few
users on a simple product that does 2 things and you introduce a 3rd than when
you have millions of users on a product that does a thousand things and you
introduce the 1,001st.

I don't understand why you're on a mission to discredit people's work or the
challenges they face when building something. It's possible to not like
something and still recognize that building that thing was an achievement in
some way. It doesn't have to be either or.

If you have counter-arguments to what I'm saying and they're informed from
your experiences or what you've learned, I'm _genuinely interested_ in hearing
them. I don't care much about _being right_ as much as I do about pushing the
conversation forward. But I think we can both agree that saying "cringe"
doesn't really help anyone learn anything or push the conversation forward.

------
jaredcwhite
I really find it troubling that commentators insist on seeing this as a zero-
sum game: that in order for Facebook to win, others need to lose, or visa-
versa. Why can there only be one social network? What is wrong with
competition?

Let Snapchat be Snapchat, Twitter be Twitter, etc. The constant media frenzy
over how fast everyone's growing and if they stop growing (aka Twitter) it's
the end, just seems bonkers to me. The only reason for this rationale is Wall
Street and public stock offerings. Twitter's stock price will sink if they
don't continue a hyperbolic growth path. Never mind if the product is good, or
if the existing users are happy. I would actually argue that Twitter's product
has been floundering and its existing users feeling the blues BECAUSE of
Twitter's need to drive growth. If Twitter had decided a couple of years ago
to focus on making its existing userbase happy as well as third-party
developers contributing to the capability of the network, Twitter would be in
a _stronger_ position today.

So I don't agree at all with the premise of this article. Facebook isn't
"beating" anybody. If everyone suddenly leaves Snapchat and goes back to using
only Facebook, that's not because Facebook is evil, it's because Snapchat
looses its ability to develop products people want. If everyone suddenly
leaves Twitter and goes back to only Facebook, that's Twitter's own fault,
plain and simple.

~~~
marinman
It does become zero sum when you consider they're all vying for similar ad
dollars. For years, Twitter didn't mind being compared to Facebook because it
meant higher valuations for potential growth and ad revenue. But playing that
game meant it actually had to deliver on the growth and ad performance.
Snapchat is interesting in that it appears to be going after more traditional
brand/TV dollars, which is still evading the performant-oriented ad dollars on
Facebook.

And both Twitter and Snapchat knew the game they were playing by raising so
much venture capital at such high valuations. They could have stayed private
longer, raised less at lower valuations and laser-focused on product and
making nominal returns. But they chose to go the other route and that means
they have to deliver on outsized profits eventually.

------
bluetwo
If you look at the concept of disruption (not what most people think
disruption is, but the actual definition from the guy who coined the term in
The Innovator's Dilemma), it is a small competitor that arises that better
serves a need that only a small part of the market cares about that goes on
top create a true competitor. They don't have to do everything the biggie
does, they just have to do one important thing better.

For instance, Instagram might have been a Facebook killer, which is why they
bought them early. Oculus Rift might also have been (but that's a stretch I
think). Just to play it safe they also bought them.

So what are the features that a minority of the market cares about at this
point that might spawn a competitor that would challenge FB?

Someone dedicated to privacy, perhaps. Someone with a model that eliminates
advertising, maybe, even if you have to pay a membership fee. Perhaps someone
who does a better job of incorporating articles from third party sources
without all the spam/fake news that clogs feeds. Maybe someone who does a
better job of using the camera, or mobile-first/only technology, like pure
audio instead of text/pictures.

Other ideas?

~~~
joe_the_user
I would say that a lot of Facebook competitors aim for the kind of advantage
you are describing. And inherently fail because of the combination of Facebook
being able roll-out a similar feature, Facebook having network effect and
Facebook not being especially demanding/abusive towards its customer base - on
the later point, Facebook has banned posts or people registering false names
but back-tracked and/or not been especially aggressive about it. They began as
the tool of the early adopter but now are the tool of your grandmother with
the stickiness of that.

Consider that when Google decided to invest in Google+, they dove immediately
into demanding _more_ from customers than Facebook did with their real names
policy.

With all its success, Facebook's profitability still comes into doubt from
time to time because they aren't squeezing their customers as they could.
Which is altogether is to say that all Facebook's rivals have scheme to
extract more from the customers than Facebook and thus it's similar to, but as
extreme as Craiglist rivals - they can never be as good they because they're
constrained to come with a model they expect will eventually make more money.

~~~
bluetwo
So in where is the market need where having too large of a network is a
disadvantage? That's where you want to hit them.

------
jdpedrie
I was talking with a friend about this recently. I am not old enough to
remember the days when Microsoft totally dominated and Bill Gates was
literally Darth Vader, so in my eyes Facebook's position seems uniquely
powerful and unstoppable. I'm not sure whether it's really so, or whether I'm
just falling victim to a present-day bias.

~~~
philipov
I remember the days of Microsoft's monopoly, and I feel that Fakebook's
position is stronger than Microsoft's, but it's not unique. I feel that
Google's position is stronger still. Between them and Amazon, there is more of
an oligopoly than a monopoly now. They will compete amongst each other
following whatever compromises they come up with, but any one of them is in a
position to squash upstarts, for the good of the group.

~~~
kinkrtyavimoodh
>> Fakebook

Can we please not indulge in this RMS-esque infantile name calling?

~~~
philipov
I swear it was a typo. I'm not going to fix it.

------
sekou
Instagram was on the path to becoming a true rival to Facebook, that's why
Mark Zuckerberg bought it. They had very savvy engineers working on a
fantastic product; that's still true it's just happening under different
ownership. Facebook didn't beat Snapchat with Facebook, it beat them with
Instagram. They tried copying features directly to Facebook from Snapchat and
that fell flat.

------
shmerl
Facebook has one thing it can't do - offer privacy respectful network.
Competitors should use that to their advantage.

~~~
foglerek
The vast majority (outside HN) would still choose the network where their
friends are conveniently already located over privacy concerns. Especially
when those concerns involve pictures of their cats or other trivial personal
information.

And so the network effects remain.

~~~
tajen
\- I have many non-techy friends in their 20ies who don't post pictures or
personal stuff to Facebook because "someone told them it's dangerous". They
can't articulate the logic around this danger, that is the most surprising.

\- None of my sister's wedding pictures are on Facebook because of this reason
– It was said loud on the mic during the ceremony.

\- My mother is very afraid of having her credit card stolen by a virus in
Windows, that's why she always... refuses to install upgrades. It's not so
bad: Better an old Windows than clicking on every Update button their find.

\- I don't watch people using their phones much, but when I do, I often ask
them why they use one workaround instead of going straight to some place. "I
was told it's better for privacy" is a frequent answer.

I'm illustrating that non-tech-savvy people aren't ignoring the "privacy"
signals. They may be doing the wrong thing in the moment, but they _are_
severely frightened and they _do_ look for ways to protect their privacy.

~~~
smelendez
I have my Facebook settings configured so I have to approve tags, and honestly
I'd prefer people not post photos of me or comments like "had a great time
with Steve!" without asking.

Most of the time it's fine, but sometimes the fact that someone's in a certain
place with certain people, or not in another place with other people, is a
sensitive issue. Sometimes it can even become a sensitive issue later on
(imagine being tagged in a wedding reception five years ago, standing next to
a then-unknown Martin Shkreli).

------
xj9
do we really need a bunch of rich fucks staring at us while we're talking to
our friends? how do you even make friends in that kind of environment?
shouldn't social networks be, you know, personal?

we haven't won yet, but we will.

[https://www.bbnet.io/](https://www.bbnet.io/)
[http://www.fediverse.org/](http://www.fediverse.org/)
[https://mastodon.social/](https://mastodon.social/)
[https://gnu.io/social/](https://gnu.io/social/)

~~~
tajen
This is awesome, they're just Twitter lookalikes! but better, with federation,
this is just what we needed, awesome! ...but as a company, I can't do
advertising, should I complain?

~~~
Neliquat
Are you telling me most tweets arent promotional already?!

------
adventured
I keep wondering if Snapchat is going to end up being Facebook's Microsoft-
Netscape situation.

If Snapchat goes down (almost guaranteed at this point), it's going to be
universally blamed on Facebook. That blame - along with the likely howls from
Snapchat and its backers - will intensify anti-trust attention. The bundling
premise that got anti-trust attention with Microsoft's Windows monopoly, will
draw the exact same attention to Facebook leveraging its network to smash
competitors while it has a monopoly or near-monopoly in social (Instagram is
dramatically reinforced by Facebook).

------
martinald
I feel there is something shady missing between all these crazy headline
stats.

For example, Facebook messenger stats seem gamed to me. I never really use it,
but every time i accept a friend request it pops up a fake messenger
notification telling me that i can message that contact (opening messenger of
course).

Furthermore the quality of news feed has dropped of a cliff for me. It's
really just posts from pages and sponsored posts now. Very few people actually
post.

------
paradite
Not sure about Facebook because I am no longer a user of Facebook. To me
Facebook just felt no longer necessary once I understand that it is just
trying to trick me to stay on the page by showing me things that are addictive
to see or watch.

Interestingly the same network vs feature idea can be said about LinkedIn.
Recently they rolled out messaging feature on the main UI like what Facebook
had, pretty good move to increase user engagement.

------
pcmaffey
Facebook isn't beating its biggest rival (yet). Google owns 54% of the digital
ad market in the US, to Facebook's 20%.

Social networking (just as Search for Google) is just data collection and
distribution for its real product, ads. I wouldn't be surprised to see Comcast
take a big bite of this market in the near future too (since they can now
compete via data collection and distribution).

------
malikNF
I finally used snap chat a few months ago, and the experience was just
annoying. Don't get me wrong, the whole take a snap of your face, make your
voice sound funny is really fun and all, but the UI was just annoying, there
were emoticons appearing next to my friends names, I had to google it to find
out what it meant.

There was some number next to my name, next to my friends names, god knows why
its there, i'm assuming something to do with how many snaps you send.

The navigation.. just really unintuitive. So as a user it makes me not want to
explore the app, hye i got a snap from a friend, okay watch send a "haha nice"
message and forget about the app.

While it's kinna scary to watch how much power FB has, I can't help but think
its snaps own damn fault for making something that does one thing, and for not
taking any measures to make it do more, to get me to stay with the app, to get
me to use it more.

------
ccvannorman
The dominance of monopoly players will not be challenged

* until *

it's normal for majority of consumers to have an AI / middleware that can
choose the best option without the consumer needing to know it's a monopoly
player or not (brand)

Example: I want to create an event with my friends at a local pub.

In 2017, I create a facebook event and invite my friends. I use Google maps or
Yelp to find an appropriate pub.

In 2040, I tell my Mantle / AI by voice, "make an event for me and friends at
local pub, moderate price, close to downtown." Without me ever knowing what
services are used, I'm told to meet my friends at some location, and they are
told as well. I never have to interface with Facebook, Google, Yelp, or
anything but my Mantle.

I cannot wait for this, as I am completely sick of Facebook and Google fucking
up basic functionality and eating competitors. I also don't want to do the
work of constantly knowing what is the best competitor to use for simple
services.

~~~
oblio
Who's going to produce your AI and why won't they be biased? ;)

------
thr0waway1239
If you feel, like I do, that if WhatsApp were not acquired by Facebook

a) their growth rate would not have been much smaller b) they would probably
have just as much or greater user engagement than what FB has today

then the actual question should be:

"What is actually going on which allows such acquisitions to bypass the
antitrust laws?"

~~~
tim333
I was thinking it could be a good thing to use antitrust laws to prevent
Facebook dominating by buying its competitors. I mean winning by having the
best product is fair play but not by buying anyone who may be a threat. I'm
not up on antitrust law - I'm guessing they don't apply to social networks
currently?

------
aub3bhat
Snapchat's app is atrocious, and they have essentially ignored the "poor"
customers. Why FB should not be allowed to provide a better user experience? I
think we should be lauding Facebook/Instagram for providing their users a
better more private user experience.

~~~
mr_spothawk
> more private

wat?

------
atishay811
I don't think Facebook is beating snapchat. When you start to follow you
always stay a step behind. Doing that with a bloated behemoth of a product is
very difficult. Camera effects were successfully copied as they were a new
concept, innovative but not disruptive. But the real challenge would come if
snapchat or someone else comes out with something that is already there in
Facebook. If Snapchat released a better version of the like button or the
wall, will Facebook be willing to risk changing the like button or the wall to
match snapchat? Will it risk losing the lovers of the wall for the lovers of
the new thing that replaces the wall.

------
kensai
Question for all: would it work for a social network startup go the opposite
way? copy the best of Facebook functionality, without the bloat, the overhead,
and the ads?

(but then how would they make money... hmm)

------
somid3
Yes, this is typically called network externalities, or network effects. It is
an ingredient that increases defend-ability by locking a critical mass.

------
joshjkim
This a good start, but I think there could be a lot more thought given to how
we should think about monopolies in the context of markets where networks
effects are crucial to the business value (aka. Facebook and Google most
obviously, arguably Amazon, Apple), because one logical conclusion is that in
a market where network effects are a major factor, the biggest network should
be best positioned to provide the most value and therefore (assuming it
doesn't actively eff things up on other fronts) should continue to grow until
it dominates the market...which seems to pretty much be what happened, and it
makes pretty good sense for the most part. in these cases, it actually seems
BAD to break these networks apart, since their scale is arguably one of its
primary values to the customer - this doesn't mean of course that they can't
abuse their monopoly powers (I think they probably do to some degree and will
continue to), but interesting to think that the traditional "break up
monopolies" impulse doesn't make as much sense. this leads me to think it will
just be more consumer-protection-related regulation (under the banner of
consumer privacy, or maybe even public health, given all the "social media
addiction" thought pieces out there these days ha).

(repurposed a prior discussion but arguably more relevant here!)

One thing I've found super interesting/impressive about Snap is that it didn't
try to outcompete FB in terms of sheer network size for its usage stickiness,
and instead turned smaller, tighter and more private networks into a
differentiator, while at the same time providing advertisers/brands with a
competitively massive audience - not an easy thing to identify, much less
execute on. TBD if that differentiator is enough to keep them alive vs. FB's
more traditional network-effect-driven advantage, which will be hard to beat
on its own terms. I think Snap's success will depend a lot on its ability to
avoid being tempted to play that game (see: Twitter!).

random other thought: this all also reminds me that Mark Zuckerberg has not
made a peep about wanting FB to be thought of as a "utility" in a long time
(or maybe he has and I just missed it...but couldn't find any recent mentions,
see this talk from 2013: [https://techcrunch.com/2013/09/18/facebook-doesnt-
want-to-be...](https://techcrunch.com/2013/09/18/facebook-doesnt-want-to-
be...)), probably in part because they are now a lot more at risk than ever
before of being regulated like one. Also kind of funny to hear him talk about
"we don't want FB to be cool" too, because now it seems like FB very much
wants to be cool again now that Snap has become cool and has threatening user
counts.

------
101km
A leaky bucket, no matter how large, will eventually drain.

~~~
simias
Not if you fill it up faster than it drains.

~~~
101km
The pool of users is finite.

~~~
Qub3d
For more on this subject, see this relevant What-if? post:

[https://what-if.xkcd.com/69/](https://what-if.xkcd.com/69/)

------
partycoder
While there were communities with large and working social graphs like ICQ,
AIM, Myspace, etc., Facebook had a more committed approach emphasizing real
identities rather than pseudonyms.

Being first to market with an accurate social graph consisting of real-life
identities is what gave Facebook its advantage.

~~~
kornakiewicz
And that's biggest disadvantage for most young people.

Also, Linkedin was earlier, but real-life identities was first, because of
understandable purposes.

------
coleifer
We're talking about FB's decision to add mustaches to your face while posing
for a selfie. It's couched as a debate about business ethics / innovation, but
remember: we're talking about dog ears and mustaches.

------
rbur0425
i swear these media outlets read hacker news/medium/any other popular blog
site and just regurgitate information

