smehro

9.Network Effects

Excellent review of network effects, complementary products and technology adoption. This is a very concise explanation behind many recent successes such as Apple’s app. store and why it gives IPhone this huge competitive edge over other mobile phones.

Lecture Slides:

How do web companies become so big so fast? Network effects!

Great article from FastCompany on Network Effects

Read the following bookmarks on the “free” economy. These articulate a new business model that is beginning to take hold on the web:

The free economy

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  1. I read the network effects article. As well articulated as it is, I am not too sure of what the author is trying to say/teach. Either the subject matter is already out there in the open with talks of Web 3.0 in gestation and so I didn’t have the ‘aha moment’ while reading it OR I have missed the takeaway from this read. Would appreciate if we could briefly touch upon this during class.

  2. I think he is trying to say the power of viral marketing in writing new rules and creating value of today’s market, Which can be reflected from a quote from the article, “The real beauty of AOL’s service (or any web services) is that, like any network, its value grows to the nth power of the number of people who use it”
    This is the power or network effect or say, the power of “viral Marketing” ….
    “In this new world, companies don’t sell to their customers. Current customers sell to future customers”

  3. KT and Sam,

    Please also see the links in delicious under smehro,DSIR (demand side increasing returns) for more on Network Effects.

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