Among Yahoo’s properties the one that most impresses me is Yahoo groups. In part because of my long standing fascination with things that enable the generation of vast numbers of small groups. Businesses, assuming there are any of this kind, have the possibility of tapping into Reed’s law. Which in turn makes the more vital that even the ones tapping into network effects.
You can see similar patterns of vigor group forming in Flickr.
Delicious on the other had is been, inspite of years of mumbling, entirely about one group – the global tagging group. Of course groups have such a compelling need to from that if you look you can find groups forming at delicious. Many people who use it talk about being aware of one or more groups there that they are affiliated with. But that’s happening inspite of the software – much like prisoners tapping messages out to each other thru the walls.
So, of course, I find it interesting that the delicious blog mentions social when talking about their acquisition.
These business models that tap into network effects and their friends are subtle. I like the phrase “monitize lightly” here. But what it implies takes a bunch of work to think thru.
I have a friend with a topic specific blog. Their site is very very highly ranked in Yahoo search, but hardly visible in Googles. I’m reasonably confident I know why. Their site’s if often referenced in yahoo groups associated with that topic. Interesting complementary effect there.
While that speaks to the question of how one might monitize some of the value in socialization hubs it also speaks to another hard question that floats around in these network businesses. Which complements must the hub own. For example I think it’s absolutely necessary for a operating system hub/monopoly like Microsoft to own those complements which are used by more than 80-90% of their users, if those complements have strong enough network effects that they tend to condense into practically one vendor. They need to own the word processor because if they don’t the word processor vendor becomes so powerful a complement that it can force them to negotiate by threatening to enable users to switch to competing operating systems.
The delicious acquisition just reminds me that we don’t know which complements the search engine hubs are going to have to own.