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@alan Again, Paul's point is that there are a lot of interesting ways Facebook may create huge revenue streams in the future.
This is a great essay, guys, and if you don't understand it the first time, you should re-read it.
With respect, I think thats the only reason anybody gives them any credit for being anywhere even near a possible $ bn future valuation - monetizing that "graph" was the whole point of Beacon for example, but the user base reacted quite strongly to having all that captured data (ab)used.
I am however confused how you gonna make money in friendfeed. You can also work on somewhat similar model as you described for facebook. After all friendfeed is opt-in oriented service, so spam will be zero there too.
I myself have a suggestion for making money on friendfeed. Very obvious is google adsense for friendfeed searches. However you can also show 1 sponsered post/day on the top. or 4-5 sponsered posts on right side as techmeme shows.
Good article. Its always tough making predictions about the future but I appreciate people who try.
I personally don't think Facebook will ever be worth much for two reasons:
1. Most people including me do not like to put our personal information online. There are n number of ways to keep in touch with friends and family without facebook. So facebook can never go mainstream. Facebook is infact no different than geocities.
2. Its rare to find a profitable business model on the Internet. Of all the companies that came and went there are only a few really profitable companies on the Internet - Google, ebay, Amazon. The odds of facebook finding a profitable business model are against it especially since its been around since 2004. I won't bet on it.
Thanks again for the article. it helps us all to think.
Augustus
For an average user, 1 in a thousand of their friends (since not many people have thousands of friends, we may as well think that as 0) do not contribute content on websites (digg, wikipedia, etc.) So it seems pretty unimaginable to build a search engine around edits by your friends.
Any further explanations on that?
Some other apps/ideas that they could tie on top of their service:
1) Full Blown Email
2) Music download/streaming Service (tied to social recommendations)
3) Movie Download service (again tied to social recommendations)
4) Service Exchanges (e.g. ELance, Rent a Coder where trust is still important
etc...)
I niggling doubt is why Classifieds/Marketplace hasn't taken off within Facebook yet (or has it?)... A leading indicator to if marketplace related activities (e.g. Auctions) would take off is if Classifieds take off. This is bothersome...
Perhaps, people are willing to go through the extra mile of dealing with scammers if they get an additional response for a classified listing or auction...Does that mean that marketplace related activities can partially live outside of Facebook but with a link back to your FB profile for full benefit and less scammers...
I agree that Facebook does have a lot of info on you, but I don't know how deep that info is. I wrote a post on how I think Digg has more Attention Data on you than Facebook does: http://www.unodewaal.com/2008/04/14/social-news...
Have you seen what Magnolia did with sign-ups? You authenticate against Facebook (or any other account) and which verifies your identity. Apparently they had a huge drop in spam numbers, which is a good testament to verified identity!
Number of MySQL servers
MySQL one master/three slaves
Facebook 1,800 (900m/900s)
Number of Web Servers
Facebook 10,000
oupsie I'd say
from http://www.paragon-cs.com/wordpress/?p=144
I agree with your observation.
I think design of a product (information based - I'm not referring to products like Dyson vaccum cleaner) once you have a high-level business idea is very simple.
Principle 1:
Information is better consumed when it is pushed to users than making them pull it.
Principle 2:
Information is even better consumed when it is relevant.
I think the above 2 principles to a large extent can satisfy most products that are information based. How information pushed can be made relevant can have multiple design solutions. Identity is one ingredient that helps establish relevancy.
Regards,
Karthik
Paul, I am not surprised to read this. However, I would like more insight into your thinking on this - what more do people want out of an auction site? To me, the huge user base of ebay has provided it with what users really want - more options, more direct price competition. It is to every users great advantage to have many versions of the same item listed on the same auction service. And of course, these prices are specific to ebay - another auction site will have somewhat different prices. As a result, ebay has locked in its user base by offering more value than anyone else can for its users. Other sites have a chicken vs. egg problem of sorts - they need more users to get more price competition, and they need more auctions to get more users. It is a very difficult obstacle to surmount. And if the popularity of the very basic-ui craigslist is any indication - people are interested in prices, not features. Your thoughts?