Tattertech Blog

I’d been meaning to write about this for a few days now, but haven’t had the time to put as much into it as I hoped.   For the moment, let me give the slightly shorter analysis:

Assuming that large properties such as Facebook, LinkedIn, and others actually follow through on a serious initiative to free user data in a meaningful way, I believe we’ll see significantly lower barriers to entry in the social app landscape and greater innovation.

First let me set out a few key characteristics (in my eyes) that define the industry at the moment-

• Relatively low development costs.  It’s fully possible to essentially bootstrap a social app’s development.  Although the investment may be high, it can be done in terms of time rather than initial capital.  A project I’m working on at the moment is completely unfunded, with a few main coders committing free time in exchange for future potential.   A debate on whether or not this is the best approach aside, it’s fully possible.
• The above low costs leads to a crowded space with plenty of me too clones.  Because just about anyone can develop a basic app either through an investment of time or actual money (outsourcing or hiring), and because of the constant buzz around social sites, everyone wants a way into the market.
• However, few of these sites actually gain any momentum.  A number of factors can contribute to this from little or poor marketing, too many identical services, shoddy design, etc.

But what I think we may see is one of the biggest barriers to success for social sites is the user’s social graph.  Even the trendiest early adopter will get tired of re-entering all their data - and rebuilding all their relationships eventually.   And not only do I need to do all that again if I sign up for a new service, but I have to bank of my friends doing it too.  And each new network/application sees an attrition rate as people stop wanting to port over to it.

But now (ideally) your social identity and relationships become easily portable.  That new web startup can just include a way to bring over all the user’s Facebook relationships.   Sure, someone still needs to actually come over and undergo some form of sign up, but the user’s investment is much smaller.  And it’s that much easier to encourage others to check it out.

On the one hand, some people have suggested that this seems bad for a Facebook or other similar site.   I think really this actually strengthens their position.  By opening their data up, they block entry for new competitors of the same type (by sheer scale they already do to some extent).  Personally, I don’t want to maintain the same list of likes, dislikes, hobbies, etc in ten different places.   I want one profile (or maybe two at most - one professional and one for personal friends) that goes wherever I think it should.  Why maintain two sets of profiles if the services are essentially the same between the sites?  Fewer people may maintain their profiles across similar properties and opt to use one as their master profile.

If that holds true, I see the large scale generic type networks consolidating from where they are now.  Where the benefit lies on the whole is that now specific niche services can boom.  Facebook can only have so many features and do so much.  However, other properties can rise up around it that leverage those existing relationships and provide unique services.  I think we’ll see greater success if the market takes this shape for very specific and unique web services.  Things that are too specific or niche for Facebook to bother cluttering their design/feature list with.

In the end, I think we end up with a less competitive top end of the market (I can almost see a Facebook becoming close to simply a data warehouse for some people), but a much more exciting and competitive ecosystem around the major networks that stay standing.

Tags: DataPortability, facebook, linkedin, social app, social graph

This entry was posted on Monday, January 14th, 2008 at 12:03 am and is filed under Internet. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.