[catone]

My buddy Allen Stern (of CenterNetworks) said something recently in a podcast that I liked and is relevant here. Paraphrasing, he said something like, "In New York City there are a thousand pizza places and new ones opening up all the time. Many of them are successful and some of the new ones will be, too."

Or, in other words, there is always room for new startups that do the same thing. Just do it better or differently -- have better crust, better toppings, faster delivery, free breadsticks, etc.

As you said, "there are always people who are looking for a better solution." You just need to make it.

[whacked_new]

It's very misleading to compare pizza places to web businesses.

Every new pizza shop adds tangible value to the system. It has a physical presence and sells a physical good that fulfills a basic need.

A web shop, without marketing, adds basically zero value to the system. It's not like you can "walk by" and discover that it provides something. And I don't think any pizza shop bootstrapped its business by offering pizza for free until it got a critical mass of popularity.

The message makes sense, but the example does not.

[catone]

I think you're reading too much into the analogy -- or misreading it.

The analogy isn't, "web business are just like pizza shops!" Rather, the sentiment that I think Allen was communicating is, "in _any_ business, there is always room for competitors and new ways of doing things."

I wish I could remember the link to the podcast so you could hear it in the exact context.

[undertoad]

It might make sense--a pizza shop owner who couldn't afford to rent in a highly-trafficked area may have similar problems bringing customers to his storefront (stores don't usually pop up and have instant success).

Plus, a brick-and-mortar store owner has higher fixed costs.

[fallentimes]

It's not like you can "walk by" and discover that it provides something.

Sure you can, organic traffic.

[AlanEdge]

There is always room for new startups to do the same thing, but in consumer internet it typically requires a drastically different angle because network effects and switching costs kick in (whereas it does not for a single pizza parlor).

This is why Friendster was forced to focus on China and give up hope in US.

YouTube's competitors had a hard time moving in on mass-consumer video (they were forced to go white label or focus on businesses, monetization, or analytics) due to the push-pull effect of YouTube's entrenched publisher-viewer community (and their network effect of widgets scattered across the web).

Kijiji positioned dramatically different than Craigslist (100% ad supported and much better UI) and it was seeded with a different audience (all the inactive eBay users were spammed giving it overnight critical mass).

SmugMug does a terribly good job and its not clear what angle you would take in entering their market. They have scale (300K paying users) and killer customer support (which is critical for their target customer who typically lacks technical expertise) and can outprice folks looking to replicate their offering with a significant incremental improvement to their service.

What angles to entering the photo-sharing market do you folks see?