Keep Making Social Networks, Facebook Hasn’t Won

“Stop Making Social Networks, Facebook Won” by Nelson Minar is an interesting blog post that’s getting a lot of attention over on Hacker News right now.

The gist, if it wasn’t obvious enough from the title, is that Facebook is “Layer 7” of the Internet (a reference to the OSI network model) with it’s tight yet comprehensive control of the social graph. Minar asserts it is the de facto social graph for the Internet.

What’s odd about the post is that it acknowledges several problems with declaring Facebook as the winner, but doesn’t provide any workable suggestions. In brief, the issues are:

• Facebook will let some entities tap into their graph via Facebook Connect but not others (eg Apple Ping was refused at the last minute)
• Facebook has a lot of limitation as to what you can do with the social graph data, caching rules, etc – although this is loosening
• There is no uber social graph: My Facebook Graph isn’t anywhere near the same as my LinkedIn Graph (both ‘tier 1’ graphs for me) and again are very different to my Flickr, FourSquare, etc

All of these issues would appear at odds with declaring Facebook the winner of the social network and social graph battle.

The author concludes:

“Sadly OpenSocial is a failure and because of network effects I think it’s too late to displace Facebook”

What’s bizarre about his post is that it fails to look at the history of the Internet – where patterns and paradigms can be identified and extrapolated into the future.

They said that Larry and Sergie were doomed because Yahoo! had all the network effect. Ditto Jobs vs Microsoft.

What Nelson hasn’t factored in is that ultimately companies have a lifecycle and Facebook’s will wane too. It’s why I laugh at my friends who are buying up Facebook stock on the secondary market at $70/unit @ $33bn valuation right now. Perhaps you could make an argument that it’s worth that, but what kind of headroom is left for Facebook to get so much bigger that you will see a return on your investment?

As a company grows, it can only innovate so quickly. It becomes more conservative, less willing to take risks and in Facebook’s case it will ultimately have to bow to external pressures post-IPO.

All of these make excellent targets for disruption. The model I like to talk about these days is not that of incumbent disruption but that of disruptor disruption. When the new school gets kicked by the new-new-school

We must also not ignore the insatiable consumer-driven appetite of man kind – we all want to be driving a new car, drinking at a new bar, etc. Facebook is already becoming passe in many circles and that will continue.

So I say let’s not give in to Facebook. They haven’t won. They probably will always be a dominant force for the foreseeable future of the Internet, but there’s plenty of opportunity for others to beat Facebook at it’s own game.

Just look at the list above for the obvious points for disruption:

• Create a proposition that has a social graph that lets a user delegate two way access to anyone the user wishes. Facebook can’t do that.
• Create a proposition that lets users manage intersecting graphs (family vs work vs friends vs niche use x). They say it’s too complicated for regular users to understand – maybe 2 years ago but now it’s a more apparent problem most users will understand. Facebook stopped trying because it was no longer was beneficial to them (this feature is no longer shown when you add a friend).
• Utilize PoCo and other open formats that let you map nodes (users) in the graph that are not even registered with you yet – to flattern the network effect Facebook currently has against everyone.
• Build your social graph around uses and applications that Facebook won’t compete with or have failed to launch a strong product in – eg video, photos (FB sharing is terrible, Flickr is terrible these days), etc

There’s plenty of opportunities out there, I’m working on a few – what are you doing?