Why Did Facebook Surpass MySpace?
In 2003 MySpace was founded and was then purchased two years later for nearly $600 million. Prior to 2008, MySpace was the social media king that many American’s relied on to facilitate and enhance their social network. However, as social media sites like Facebook emerged, more and more pressure began to build on MySpace’s ability to innovate and keep up with the demands of its users. In order to keep up, MySpace came out with many different products and suggested rigid topics for users to select and communicate through. It also blasted pages with advertisements to increase funding for the new products. It would seem that MySpace in fact came out with too many different products and as a result the products were dysfunctional and users didn’t get the more personalized online atmosphere that they desired. This left users irritated with an increasingly dysfunctional interface that was also riddled with advertisements.
While the pressure on MySpace to innovate at a high level yielded many bad decisions on their part, it could have been handled much better. Perhaps the solution is found in Reed’s law, which David Reed developed in the late 1990’s. Reed’s law fundamentally states that the value of social networks is not just reliant on how the network connects individuals; rather it relies more heavily on the network’s ability to encourage the formation of sub groups. Thus, connecting individuals with like interests and providing a means for them to communicate over topics they are each passionate about is quite powerful. Conversely, letting any two random people with random interests connect through fax or instant message tends to be less powerful.
From a mathematical standpoint, the reason that the formation of cohesive sub groups is more powerful is that:
- # of possible sub-groups of network participants = 2N− N − 1
- # of users =N
- # of possible pair connections =N (N-1) / 2
As demonstrated above, the equation representing the number of possible subgroups within a network grows exponentially, while the number of users and possible pair connections are more stagnant in their growth. Therefore, network sub-groups create a much larger social landscape that in turn can provide users with a much more personalized and meaningful experience.
Understanding Reed’s law allows us to take a large step forward in finding just where MySpace went wrong. The decision for my MySpace to attract more users through random products didn’t only fail because the products were dysfunctional. The problem was that most of these products didn’t focus on forming essential customizable subgroups for users, and instead focused on increasing revenue through content that users had little interest in viewing.
Facebook caught up to and surpassed MySpace because it provided means of connecting users meaningfully through different tools, apps and groups with more options. On the other hand, MySpace focused on selling page space to advertisers and became less “social” as a result. Facebook’s ability to please customers through a higher quality social platform enabled it to steal most of the market share and surpass MySpace along the way.
Sources:
http://www.forbes.com/sites/chunkamui/2011/01/12/why-facebook-beat-myspace-and-why-myspaces-revised-strategy-will-probably-fail/
http://web.archive.org/web/20080526050751/http://www.contextmag.com/setFrameRedirect.asp?src=/archives/199903/digitalstrategy.asp
http://www.huffingtonpost.com/2011/06/30/how-myspace-fell-apart_n_887853.html