Comments on: Ker. Ching. – using network effects to dominate tiny markets

By: hugh macleod

hugh macleod — Tue, 30 Aug 2005 20:31:33 +0000

I’m an optimist.

As the more cluttered the web becomes (and it was already pretty cluttered 5-10 years ago, let’s not forget), the greater the demand/need for authenticity and relevance.

What web format that takes matters little. It might be blogs today, but it might be something else in 3 years.

By: bhyde

bhyde — Mon, 29 Aug 2005 01:18:18 +0000

Ian, great reminding. Puts an interesting light on the critique of main stream journalists about the professionalism of amateur bloggers. (see airline sandwich story: http://enthusiasm.cozy.org/archives/2003/04/criminals-advocate-standards/) That’s not unlike the way that in some industries you see standards introduced to create a quality floor; in part to avoid the problem that Akerlof quantifies.

I wonder if you could actually quantify extent that a market can be spoiled by making it totally open market. I guess you might argue that the highly skew’d nature of the market helps to prevent the severity of that spoiling. Sure there are 10 million blogs; but blog quality is defined by the top 1000; and the rest are viewed as being just used cars.

By: Ian Holsman

Ian Holsman — Mon, 29 Aug 2005 00:28:48 +0000

This might be of interest: http://en.wikipedia.org/wiki/The_Market_for_Lemons
George Akerlof won a nobel prize for it in 2001.

How I read it applies…

as more ‘junk’ comes out, people get to expect that the value of the entire market is junk, and the high quality stuff gets dragged down with it.
so the high quality niche players lose their value.