| 'Facebooks' come and go, geocities, myspace and so on... True, but at one point that was true of search engines, too. Sometimes the music stops and a winner plants their seat in the most profitable position. Many of the entrants so far have been happy to follow the strategy Mark Cuban recently outlined in his anti-freemium post. "More importantly, when you see your BlackSwan company appear and you know they will kick your ass, rather than ramping up to try to compete, get out. Sell." There's much to recommend that strategy, especially if you'd rather own an NBA franchise than a web company. But Facebook has plenty of Nth generation advisors and investors who want to escape the flame-out/sell-out cycle and go for the Google-sized enduring win -- Andreesen among them. That changes the questions: Is there a niche for a universal, well-tended social/identity network platform? (I think yes.) Will one gorilla dominate that market? (I think yes, it has many of the same network-effects and natural-monopoly aspects as search or operating systems.) Can the Facebook team avoid the nightclub-like fad boom-and-bust cycle? (I think probably; they're certainly wise to the problem and building defenses like crazy.) Will being the de facto monopolist in this market involve massive new revenue streams (beyond advertising) that can now only be imagined? (I also think yes. Distrust and fraud are the biggest drains on internet value creation; a trust-network anchored in real-world relationships is the ultimate countermeasure.) |