Back in August of 2006, I wrote a post entitled, Social Networks as Fads. To recap, my thesis of social networks was that there was always going to be a ‘flavor of the moment’ and that once everyone gets sick of that flavor OR something new and exciting comes out (which is every 6 months now), that social network will lose the majority of it’s dominance.
The analogy I used is the NYC Club Scene. A “hot” club cannot be hot for too long. Chances are, the following summer, the club will either not exist or it will have a totally different crowd.
After reading through my RSS feeder this morning, I see news about Steve Ballmer saying that Facebook could be a fad. I thought he was going to pour significant money into Facebook at an insane valuation. Would I do that if it was a fad?
Facebook is certainly interesting. There is an entire ecosystem of companies built around Facebook that should provide it some staying power. There are also a lot of unknowns at this point. The ecosystem around FB was built because it’s fairly open. When FB starts to charge tolls or other fees for accesing data on FB, how will the current ecosystem play out?
Trendsetters inherently like to be where other people aren’t. The Killers, the Lower East Side, All-Stars, Spice Market, Apt, and others. Now that there are tens of millions of people on Facebook, will the trendesetters move elsewhere and start another goldrush?
On one hand, I believe that this may happen. It’s happened before and history repeats itself more often than not. However, I think Facebook is starting to attract the mainstream audience of users which tends to move slower. According to this Fool.com article, we’re moving into The Bowling Alley crowd.
Once across the Chasm, the Bowling Alley phase begins, representing the early majority. The creation of the whole product to fulfill the needs of a niche market requires an additional strategy beyond product leadership: customer intimacy. Once the whole product satisfies the needs of a niche market, pragmatists embrace the technology, and a “pin” — as Moore calls it — is knocked over. Technology vendors should seek a beachhead that will allow them to leverage their success in one niche market to attack another.
Where this all plays out, I have no idea. I’m watching carefully though.