#networkeffects — Public Fediverse posts
Live and recent posts from across the Fediverse tagged #networkeffects, aggregated by home.social.
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A minor point: We need to take care to distinguish #NetworkEffects versus #SwitchingCosts.
A “network effect” is often good for the people affected (more people in the system makes it more appealing to join that system) and we typically want that effect.
A “switching cost” is typically bad for the people affected: Anyone already in the system, must give up something when they try to leave.
We need to *lower* the hostile switching costs, and retain the beneficial network effect.
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CW: Long thread/9
For most of the history of consumer tech and digital networks, fire was the norm. New platforms - PC companies, operating systems, online services - would spring up and grow with incredible speed, only to collapse, seemingly without warning.
To get to the bottom of this phenomenon, you need to understand two concepts: #NetworkEffects and #SwitchingCosts.
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#BigTech #Capitalism #NetworKEffects #SwitchingCosts #Economics: "While it’s possible in theory for competition to work well even when network effects and switching costs exist, it’s probably best to assume that they are gumming up the works. Paul Klemperer, one of the pioneers of switching-cost models, has argued that antitrust authorities should try to ensure compatibility between rival platforms, reducing switching costs and pushing against the ability of any one company to monopolise a network.
That means maximising interoperability: the ability to send posts to your Facebook friends, and read their posts, even if you’ve decided to leave Facebook and use a different social network; the ability to take your eBooks and audiobooks out of Amazon’s ecosystem (you paid for them, after all); the ability to put any kind of ink in your printer, any kind of razor blade on your handle and any kind of bread in your toaster.
Interoperability cannot be guaranteed by law. There are too many hard cases, too many grey areas, too many legitimate technical obstacles. But regulators can operate with a presumption in favour of interoperability, as they do for switching phone providers or making transfers between banks."
https://www.ft.com/content/acaf3fb1-d971-48ad-8efb-c82787cdd2fc
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"… #antitrust authorities should try to ensure #compatibility between rival platforms, reducing #SwitchingCosts and pushing against the ability of any one company to monopolise a network. …regulators can operate with a presumption in favour of #interoperability, as they do for switching phone providers or making transfers between banks."
https://www.ft.com/content/acaf3fb1-d971-48ad-8efb-c82787cdd2fc?sharetype=blocked
#enshittification #NetworkEffects -
CW: Long thread/4
FB experienced explosive growth, thanks to two factors: #NetworkEffects (every new user was a draw for other users who wanted to converse with them), and #SwitchingCosts (it was practically impossible to convince all the people you wanted to hear from to leave FB, much less agree on what platform to go to next). In other words, every new user who joined FB both attracted more users, and made it harder for those users to leave.
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CW: Long thread/2
When a company is neither disciplined by #competition nor by #regulation, enshittification inevitably ensues. If a user or business customer can't jump ship - because of #LockIn, high #SwitchingCosts or #NetworkEffects - then companies are powerfully tempted to mistreat them - not out of sadism, but instead to harvest their surplus and goose the company's profits.
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Social Quitting
https://craphound.com/news/2023/01/22/social-quitting/
#platformcapitalism #enshittification #networkeffects #switchingcosts #locusmagazine #post-facebook #corydoctorow #post-twitter #socialmedia #spokenword #surpluses #webtheory #Articles #podcasts #Podcast #exodus #audio #locus #News