Facebook Externalities

Facebook: n. Website where you excersize limited (but somehow sufficient) powers over a webpage to post your entire life for large segments of the world to see which has somehow come to dominate the social scene of college-aged/-bound Americans and similar demographics in other parts of the world. Massive time-suck for people who would otherwise do things people used to do, like read, excersize, or just plain not be online sharing their ENTIRE LIVES.

Why again do people do these things? Network externalities. Here’s one example. Person “A” has friends from work, high school, their college, other colleges, their hometown, the local youth group, etc. and everyone is in the process of going their seperate ways. Let’s suppose the group of people is so large that letters/phone calls at a reasonable frequency are simply too hard to do (or too expensive). Let’s further imagine that “A” is okay with loosing day to day or week to week contact with people, but once every month or so would like to to know how, say, “B” is doing. Except for those willing to do mailing lists or their own websites, etc, before things like facebook, “A” would keep and close touch with “C”, loose touch with “B” in a couple years, and most everyone else in a few days to weeks.

Enter Facebook. Now “A” can make “B”, “C”, “D”, and all the rest “friends” (no relation to the actual level of relationship in almost all cases) and maintain as close a relationship as desired but almost guarenteed a higher one than without it–assuming “B”, “C”, “D”, etc are all on it too. Moreoever, if another person, say “G” becomes friends with “A” but is not on Facebook, it is less valuable than if “G” joins with even nominal participation (say once per week/month).

End result, Facebook is more valuable to its users when there are more users. So much so I no longer get the question “Are you on Facebook?” I only hear “I’ll Facebook you”.


About this entry