Thursday, June 30, 2011

Again - The Entropy of Social Networks: Google Plus vs Facebook?

Yes, we have a new social network and I am a proud profile carrying member of the new elite created by an artificial scarcity of invites. A technique now pretty much a requirement for launching anything new that's social with 2 benefits, the obvious buzz factor and the ability to iterate and learn before you expand.

But this post is about history of civilizations on the internet.  While Google Plus is launched, MySpace was sold in last few days for a puny $30M and Friendster for $100M. Not to mention the once acclaimed AOL that was spun out of Time Warner in last few years. A $100B+ write down?

So why do social networks keep dying? 

I think the answer lies in history of cities, and entropy of private information. Allow me to explain:

1. History of Cities: Social networks are like cities. They are born when small villages (Facebook at Harvard) expand due to a whole host of factors ranging from better cleaner layout, availability of resources (upload your pictures), ability to mingle with new kinds of people (dating & business relationships), etc. While all this is somewhat obvious - these social network cities need to be viral to expand. As more people join, we all derive more value --- hence, most of them are designed to be viral. However, this virality means over time our social network cities become crowded, cluttered and polluted with noise that makes them less valuable. Many of us intuitively feel this - how many of us have had that moment where you go from - I love my new social network city to I don't how all these people ended up being my friends? This extends beyond social network cities to many other communication tools - Yahoo! and AOL IM - small clean lists of people I wanted to talk to to a list of everyone who wants to bother us.

This happens to great cities too - London, New York, Calcutta, Mumbai - all have gone through there a growth spurts followed by the years/decades of being terrible places to live in. But the cost of building a new New York often outweighs the cost of cleaning it up and fixing it up. Where we can, we cheat and build a New Delhi (yes, New Delhi is literally a new Delhi built outside of Delhi; ditto for Jerusalem, and many other cities where you could geographically move out). Cities like New York, London, San Francisco end up spending money to fix the cities enacting laws to keep it livable and make it better over time.

Alas, with social network cities of MySpace and Friendster - no such luck. Its easier for the residents to move out gradually and live in the new suburbs of Facebook and Google Plus. And if your friends move with you, the move can be sudden and quite painless. You can live in 2 cities at once - and over time stop visiting your old city. This holds true for your old email and old IM too. Remember, Hotmail and Yahoo! Mail, or AIM - you don't call her any more, do you?

2. Entropy of Privacy
Over time, private information that is shared becomes less private. Think about your Social Security Number, when you first got your SSN - it was a rather private number. If you have been using it for a while though, its probably in the databases of dozens of banks, mortgage issuers, insurance companies, employers, payroll managers, your dentist's local office, and so on. This means its much more likely to have been disclosed to more people and therefore less private. Same is true for a new email address you acquire. For a while, very few people know your email address but as you start using your email address for its intended purpose i.e., email people - over time, email address gets shared by more and more entities and eventually is effectively public.This concept has been studied by academics with more precise definitions (see here).

The analog of this is your social network and how well managed it is. Disorder increases in your social network over time - you add more and more people, trust goes down, unless you manage your accounts as it were a full time job your social and business friends and acquaintances all get mixed - and sometimes you add strangers just to avoid offending someone.

So what do we do? We don't have to live in the mess we co-create! Rather than clean house, we move. Of course, over time - we re-create the same mess. But for the first few months, may be even years you will get a lot of value from having your clean new Google Plus Circles which is a smart innovation but hardly path breaking. Facebook could easily help us manage our friend lists by creating 5 prepopulated lists with privacy settings and auto suggesting who goes where - they have plenty of data on my social graph to help partition it which is a nerdy way of saying they can help me create my 'circles' using information such as who do I chat with, share pictures with etc.

Fundamentally, Google Plus so far is just Facebook (Circles) & Twitter (Stream) rebuilt from scratch with certain solutions that are cleaner (by definition) and better integrated with rest of my Google life especially Gmail.

There are however new kinds of social networks that are fundamentally different. is focused on the opposite of a global social network - they are creating a local social network, a way for you to talk to, collaborate with and discuss with your neighbors. While Facebook and Google Plus help me connect with my family in Australia and India - Yatown does it for my neighborhood in San Francisco. This is different and interesting.

Similarly, Quora is focused less on social networking and more on being a repository of the best answers on questions ranging from what cars to buy to how did company X get started. Its singularly focused on solving this problem with social being a side effect. Facebook Answers is somewhat similar but lacks the focus of Quora.

The mega trends towards people spending more time on social networks (Facebook, Facebook, Facebook) is a fundamental threat to Google. And Google Plus is a worthy response except it solves a problem that Facebook has already solved. It will be an interesting few months to see how this works out. In the meantime,  I am much more keenly watching what's not been solved yet ranging from local social networks, Q&A networks to enterprise collaboaration.

In the enterprise world,'s Chatter is bringing private social networks to enterprises enabling Facebook like collaboration in a secure manner within the enterprise.

Exciting times to live and collaborate in.

(Disclosures: I am affiliated with Yatown and my opinions are therefore likely biased. My affiliation to is also disclosed on my blog.)

1 comment:

Alice Smith said...

google will gain some popularity but can't bit facebook because Facebook currently has about 700 million users, and this is its main asset. Facebook users have already created their own networks of friends on the site, and it is a pain for some to switch over to another social network site. Most of the people are very satisfied with facebook which has everyting to entertain them. so i think google have to do work very harder and harder to beat fb.

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