[hollerith]

Facebook has a sizable moat: it is easy for me to join a new social network, but it is kind of pointless unless everyone I want to communicate with also joins, and it is hard to motivate them to do so. The fact that Facebook was not the first social network is evidence that that kind of moat can be crossed, but still it would be hard. And if a company starts getting traction, FB will probably offer to acquire it like they did Instagram and WhatsApp (which never was a social network, but might've become one by gradually adding features if it hadn't been acquired).

But I agree with your point: it is really hard for a new company to create a large revenue stream with a strong moat around it.