The Evolution of Social Networks: Morphing Facebook and MySpace, Vertical Networks, and the Utility of Master Profiles

Implications: Social networks, and the contribution of user-generated content and interaction that is at the heart of Web 2.0, will morph over the years as it becomes more embedded into the Web.  Vertical networks will become more prominent, replacing the kaleidescope that MySpace and Facebook often portray.  As the network effect takes off, the role of super networks, with public profiles, and vertical networks, with private or segmented profiles, will come into play.

Analysis: Social networks, and the contribution of user-generated content and interaction that is at the heart of Web 2.0, will morph over the years as it becomes more embedded into the Web.  It won't lose its importance, to say so would be to misunderstand its attachment with the essence of the Net, but it certainly will change, posing new issues as well as new opportunities to companies like Facebook, MySpace, Google's Orkut, Yahoo Answers, Match.com, and so on.

One of the great promises of the Internet is that it has begun to deliver the next generation of the network effect.  Savvy advertisers are realizing that it fundamentally changes the way they market to consumers, greatly lowering the cost of distribution to its customer base.  Instead of pushing out expensive mass media to customers, there is now the opportunity to give consumers the tools to distribute messages, in their own words and via their own interaction, to a larger base at a decreased cost.  Advertisers have been extremely slow to grasp this truly viral impact, caught up in the myth of what they think they understand as viral and, more importantly, because they only understand how to manipulate and measure traditional media.  CMOs and advertising agencies are especially guilty of slowing this movement to new media, and, though the Internet is certainly garnering more ad impressions over time relative to falling media as newspapers and TV, this pace is far slower than it should be ... and the move to network effect-based advertising has been much slower.

Tomorrow's social network will have to deal with new challenges.  As Match.com and dating sites now face competition from "universal" social networks as Facebook and MySpace, Facebook and MySpace will also have to deal with competition from vertical networks.  Currently, blogging and social networks that deal with women's issues, such as motherhood, relationships, and cosmetics are proliferating.  I am currently working on ways to maximize this opportunity, and the opportunity is huge.  Vertical networks allow consumers to deal most directly with persons facing the same issue or interested in the same topic they are.  Can Facebook and MySpace develop distinctive communities around these topics?  Look at how GeoCities and AOL have faltered in this arena.  It is much harder to do this than people would imagine.  I believe that a better strategy is to find out how to work with and integrate these vertical networks into their own network, as partners, distributing the network effect more substantially and rich-ly.

This brings up the topic of universal profiles and OpenID.  What remains in the public domain and what becomes private?  Users must always have the opportunity to protect their information.  They will share it is they are given something in return.  In my view, companies like Facebook and MySpace will do well to create this public profile, allowing individuals to share information that they would generally want to share with the crowd.  If they share too much, that is their fault.  We all want to share, want to involve ourselves in the larger discussion, as I am doing now.  Facebook and MySpace, though, must offer these profiles to other vertical sites, allow people to add to or subtract from that profile for publishing on unique domains, where they would want to share more or less.  The ease of transitioning from site to site becomes a great utility, and, when they update the master profile, that should pre-populate other profiles across the Web.

Social networks, complete with public and private expression and friend lists, will proliferate, in different forms.  Predicting the next generating and managing the opportunities will determine the winners, but the network effect is just beginning.