Can a social network become too large?

An article in the latest issue of The Economist explores the fact that there might be less to Facebook and other social network sites than meets the eye...  The basis of their argument is as follows:

[There is an] an important limitation for social networks, such as Facebook, compared with older sorts of network, such as the postal or telephone systems. These benefit from Metcalfe's Law, which says that the value of a network is proportional to the square of the number of its users. In other words, the more people have phones, the more useful they become. This “network effect” leads to rapid adoption and puts up barriers for new entrants.

But unlike other networks, social networks lose value once they go beyond a certain size. “The value of a social network is defined not only by who's on it, but by who's excluded,” says Paul Saffo, a Silicon Valley forecaster. Despite their name, therefore, they do not benefit from the network effect. Already, social networks such as “aSmallWorld”, an exclusive site for the rich and famous, are proliferating. Such networks recognize that people want to hobnob with a chosen few, not to be spammed by random friend-requests.

This suggests that the future of social networking will not be one big social graph but instead myriad small communities on the Internet to replicate the millions that exist offline.

Although I agree that social networking sites are not perfect at the moment, I don't think the reason is that they are too large, as The Economist suggests.  I want to fall back on one of my earlier posts, where I mentioned the importance of "weak ties" between people in separate network clusters to facilitate the flow of information in that network.  If the future of social network sites is really in "myriad small communities on the Internet" that are not connected in any way, each network in isolation will become pretty useless over time, since there will be no new information coming into or going out of that network. 

In order to have value (or social capital), a network needs to be (1) large, (2) open and (3) have (weak) ties between different clusters in that network.  Alexander van Elsas and Rolf Skyberg writes a lot of about the need for open social network sites, and I agree with their views and their thoughts on how this can be implemented.  The article in The Economist is an interesting read and it does raise some serious questions about the monetary value that is placed on Facebook and other sites at the moment, but I just don't think that smaller, isolated networks is the right way forward.

What's wrong with web 2.0?

There are a few very interesting posts on web 2.0 that I'd like to point your attention to.  First, there is Seth Porges' well-written reminder about how lazy we all are in The Futurist: Will Human Laziness Burst The Web 2.0 Bubble? 

He starts by defining the problem:

If the defining trait of the first Web cycle was the stupid animated GIF, the current “It” sites all have one thing in common: They are, to varying degrees, reliant on user-generated content. Without your neighbor/classmate/sister/girlfriend’s tireless devotion to keeping her profile up-to-date, MySpace would merely be a place for FOX to promote its properties. Without a horde of news junkies yearning to see their username in digital print, Digg would be an ugly page of yellow and white (and their new profile feature would be a joke).

He then goes through a thoughtful observation about how people migrate from one social networking site to the next -- first Friendster, then MySpace, and now Facebook.  He concludes:

And that is why the Web 2.0 era will come to end sooner rather than later. Because if there is one immutable law of humankind, it is that we are really, really lazy [...] The point is, it is hard work keeping up with these things. And there will be a point down the line when, even if it’s not done in a collective shrug, the Web world will just say “screw it”, and update their pages more and more seldom, until Facebook resembles Friendster.

Then the brilliant Alexander van Elsas stepped in with a great post called  The flaws in web 2.0 and how to correct them.  He agrees with Seth's laziness theory up to a point, but then he disagrees (and this is where user experience comes into play):

But, I don’t think that is the only reason why web 2.0 is flawed. A much more important reason why most web 2.0 platforms will not be sustainable in the end is that they were essentially not build to provide true value to its users, but instead they were build to create and leverage the value of a large network! The larger the network, the more value it creates to the platform owner in terms of advertisement revenues and of course the possible take over by one of the larger companies which have too much money to spend anyway. Nothing wrong with that, but it doesn’t really help the user. Users are putting much more energy and creativity into the networks than they get out of it. Be honest, have you really gotten as much value from other (often unknown) “friends” on Facebook, Myspace etc than the amount of effort you have put into this?

I agree with his opinion that we're currently not getting as much value out of social networking sites as we should, but I disagree with his viewpoint on why that is the case.  As I've written before here and here, the social capital embedded in networks are extremely beneficial to users - if they have the right connections (read my earlier post for an explanation of structural holes non-redundant contacts).

In my opinion, the network is what it's all about for the user -- the network is the need.  That is where they will draw their information benefits and control benefits from.  The flaw is not that social networking sites focus too much on the network, it's that the user experience does not allow them to tap the full potential of their networks.  As I've written before:  access and use of the resources in a network are dependant on an actor being aware of their presence.  If an actor is not aware of ties or relationships between him and other actors, he cannot use the resources available to him. Social capital then seems not to exist, and will only come into existence for that actor once he becomes aware of it.  The user experience needs to help with this discovery for social networking sites to become truly valuable and fulfill the user needs that Alexander talks about.

As for the solution to this dilemma, I am in full agreement with Rolf Skyberg on the creation of an open social network (read his brilliant post on the topic here).  But only if we get the user experience right, and that is going to be the tricky part, of course.  It needs to be an experience and an interface that allows people to identify the most important actors in the network, and tap into the benefits of those networks easily and without boundaries.  And it needs to do that without relying on too much user input because, come on, we're lazy!

Structural Holes and online social networks

A few weeks ago I wrote about the theory of Social Capital, and how that can be applied to online social networks. Today I want to talk about a related theory called Structural Hole Theory, and explain what implications this theory can have for online social networks like Facebook and MySpace. First, a little background...

Structural Holes Defined

Ronald Burt’s theory of ‘structural holes’ is an important extension of social network theory. This theory aims to explain “how competition works when players have established relations with others” (Burt, 1992), and argues that networks provide two types of benefits: information benefits and control benefits.

• Information benefits refer to who knows about relevant information and how fast they find out about it. Actors with strong networks will generally know more about relevant subjects, and they will also know about it faster. According to Burt (1992), “players with a network optimally structured to provide these benefits enjoy higher rates of return to their investments, because such players know about, and have a hand in, more rewarding opportunities”.
• Control benefits refer to the advantages of being an important player in a well-connected network. In a large network, central players have more bargaining power than other players, which also means that they can, to a large extent, control many of the information flows within the network.

Burt’s theory of structural holes aims to enhance these benefits to their full potential. A structural hole is “a separation between non-redundant contacts” (Burt, 1992). The holes between non-redundant contacts provide opportunities that can enhance both the control benefits and the information benefits of networks. The figure below shows a graphical representation of this definition.

Optimizing the benefits of networks

I will now look at how structural holes can facilitate the optimization of information benefits and control benefits. There are several ways to optimize structural holes in a network to ensure maximum information benefits:

• The size of the network. The size of a network determines the amount of information that is shared within the network. A person has a much better chance to receive timely, relevant information in a big network than in a small one. The size of the network is, however, not dependant merely on the number of actors in the network, but the number of non-redundant actors. The utility of a network with reference to its size can be described by a function know as Metcalfe’s Law. Robert Metcalfe observed that new technologies are valuable only if many people use them. Specifically, the usefulness, or utility of the network equals the square of the number of users. The more people use a piece of software, a network, a particular standard, a game, or a book, the more valuable it becomes and the more new users it will attract, increasing both the utility and the speed of its adoption by still more users.
• Efficient networks. Efficiency in a network is concerned with maximizing the number of non-redundant contacts in a network in order to maximize the number of structural holes per actor in the network. It is possible to eliminate redundant contacts by linking only with a primary actor in each redundant cluster. This saves time and effort that would normally have been spent on maintaining redundant contacts.
• Effective networks. Effectiveness in a network is concerned with “distinguishing primary from secondary contacts in order to focus resources on preserving primary contacts” (Burt, 1992:21). Building an effective network means building relationships with actors that lead to the maximum number of other secondary actors, while still being non-redundant.
• Weak ties. In his 1973 paper entitled “The strength of weak ties”, Mark Granovetter (Granovetter, 1973) developed his theory of weak ties. The theory states that because a person with strong ties in a cluster more or less knows what the other people in the cluster know (e.g. in close friendships or a board of directors), the effective spread of information relies on the weak ties between people in separate clusters. “Weak ties are essential to the flow of information that integrates otherwise disconnected social clusters into a broader society” (Burt, 1992). Structural holes describe the same phenomena as weak ties because both emphasize the need for entrepreneurs to fill the gap between different clusters and non-redundant contacts. However, structural hole theory goes one step further and stresses that what makes the gap important is not the weakness of the tie but the structural hole over which it spans. Building and maintaining weak ties over large structural holes enhances information benefits and creates even more efficient and effective networks.

To achieve networks rich in information benefits it is necessary to build large networks with non-redundant contacts and many weak ties over structural holes. Some of these information benefits are:

• More contacts are included in the network, which implies that you have access to a larger volume of information.
• Non-redundant contacts ensure that this vast amount of information is diverse and independent.
• Linking with the primary actor in a cluster implies a connection with the central player in that cluster. This ensures that you will be one of the first people to be informed when new information becomes available.

Now, once structural holes are identified and the network is optimized to provide maximum information benefits, an important question is how these benefits can be used to capitalize on the opportunities in the network. Control benefits answer this question. Structural holes not only provide information benefits, they also give actors a certain amount of control in negotiating their relationships with other actors. To understand the role of structural holes in this regard, it is necessary to understand the concept of tertius gaudens. Taken from the work of George Simmel, the tertius gaudens is defined as “the third who benefits” (Simmel, 1923). It describes the person who benefits from the disunion of two others.

For example, when two people want to buy the same product, the seller can play their bids against one another to get a higher price for the particular product. Structural holes are the setting in which the tertius gaudens operates. An entrepreneur stepping into a structural hole at the right time will have the power and the control to negotiate the relationship between the two actors divided by the hole, most often by playing their demands against one another.

Where structural holes provide a platform for tertius strategies, information is the substance with which the strategy is performed (Burt, 1992). Accurate, timely and relevant information delivered between two non-redundant contacts at the right time creates an immense opportunity to negotiate and control the relationship between these actors. That is the power of structural holes, and that is why the theory is so relevant for social networks on the Internet.

Implications

The different benefits of structural hole theory makes it instrumental in the creation and development of social capital in networks. The information and control benefits described by this theory can identify and expand the intrinsic value of networks. If we want to find the value of online social networks these three constructs — social network theory, social capital theory and structural hole theory — are essential tools.

For example, if we apply these concepts to MySpace or Facebook, we quickly realize it is not the sheer number of "friends" in your network that count, it is the diversity of the people in your network that is most important. If you only have links to people in your immediate group of friends or colleagues, it will be difficult to get new information, since everyone will pretty much know the same things. This is not to say that you have to start adding random people to your network who you don't know, but it does mean that people with who you have "weak ties" will often provide you with new information and therefore more benefits than your "strong ties".

These theory also explains why eBay is such a huge success. By stepping into the structural holes between millions of buyers and sellers, the perfect tertius gaudens strategy was created, and it is arguably the best example of the entrepreneurial use of structural holes in the history of the Internet. If you think about it, every Facebook App is a tertius strategy -- some are good, some are not. But it shows that there are still a lot of structural holes out there in social networks, waiting for someone to step in and broker the deal...

References

Burt, Ronald S. (1992). Structural Holes: The Social Structure of Competition. Cambridge: Harvard University Press.
Granovetter, M. S. (1973). “The Strength of Weak Ties.” American Journal of Sociology 78: 1360-1380.
Simmel, G. (1923). The Sociology of Georg Simmel. New York, Free Press.

Social capital in online social networks

As part of my postgraduate research I did a lot of work on Social Network Theory and Social Capital -- two academic theories from the social sciences field. This was before the rise of online social networking sites. I recently revisited some of the work I did, and I became interested in mapping the concept of Social Capital to online social networks as they exist today. In order to to that, here is first a definition and explanation (pulled from my dissertation):

Closely related to social network theory is the theory of ‘social capital’ which deals with the intrinsic value of network structures. In general terms, social capital "consists of resources embedded in social relations and social structure, which can be mobilized when an actor wished to increase the likelihood of success in a purposive action" (Lin, 2001b). Lin (2001a) points out two important components concerning this definition:

• First, resources are embedded in social relations rather than in the individual. The properties of the network and an actor’s position in that network are more important than the actor himself.
• Second, access and use of these resources are dependant on an actor being aware of their presence. If an actor is not aware of ties or relationships between him and other actors, he cannot use the resources available to him. Social capital then seems not to exist, and will only come into existence for that actor once he becomes aware of it. The ability to identify networks and key role-players in these networks will therefore make it possible to identify social capital where the relevant actors may be completely unaware of them. The goal of finding the key actors in a network can therefore be likened to gauging the social capital of a network and finding value in networks where it was not previously observed.

From the definition it is inferred that social capital depends first on an actor’s position in the network (are they in the right place to access the resources?), and second it depends on the nature of the resources in the network (are the resources worth accessing?).

It is very interesting to think about online social networking sites in this context. The social capital (the value of being in the network) depends not just on the individual people in that network, but very heavily on the way they are connected. Connecting to the "right" people end up defining you and building your social capital, because other people will "judge" the amount of capital you have based on your connections and your interactions with these connections. In this context it is essential to find those "key actors" in the network that are going to increase your social capital the most -- the popular guy, your VP at work, etc.

Now, according to Adler and Kwon (2000), there are 3 benefits of social capital:

• Social capital provides actors in the network with access to broader sources of information at lower costs.
• Social capital provides actors in the network with extended power and influence.
• Social capital facilitates solidarity between actors, as strong networks encourage compliance with rules and customs without the need for formal controls.

Again, it's interesting to overlay these concepts on social networks online. Let's look at each in turn:

• Access to broader sources of information at lower costs. "Lower costs" in this context would mean less effort -- you are able to get access to the information you want about your friends without having to reach out to them in a traditional sense with a phone call or hanging out. On Facebook, for example, the news comes to you through the "Mini-Feed" application. You know what the people in your network watch, eat, do, listen to, etc. And this social information is of course an extremely powerful marketing tool. Social networks enable this information to spread much more easily (i.e. at "lower cost").
• Extended power and influence. People with higher social capital not only get the benefit of more (although not necessarily better) information, but they also stand the chance to become "opinion leaders" that a lot of people rely on. And this is not necessarily the person with the most connections (I will talk about this in an upcoming post where I will discuss Ronald Burt's theory of Structural Holes). This power and influence can really go a long way to build an online identity that becomes a sense of pride -- consider the lonelygirl15 phenomenon, or influential blogs like TMZ and The Drudge Report.
• Solidarity between actors (compliance with rules and customs without the need for formal controls). This is an interesting one to think about. Even though there is so much freedom to do and say what you want online, strong social networks seem to have their own rules in terms of what is allowable and what is not. I think here for example of the "Groups" feature in Facebook, where people who don't necessarily know each other connect over shared interests. "Misbehaving" on Facebook or MySpace, in whatever way that is defined for a particular network, will get you kicked out of the circle -- friends will drop you, groups will take you off their member lists, etc. This all serves to build the strength of the network and its members even more.

"So what?", you ask? Well, I think that we don't pay enough attention to theory. I just read this paragraph from my dissertation again:

Theory and practice cannot be separated. Virtually every practical decision a person makes and every practical opinion a person holds has some theory behind it. Theory makes the facts of social life comprehensible and places seemingly meaningless events in a general framework that enables us to determine cause and effect, to explain, and to interpret. Even half a century ago Revzan (1951) commented that "analysis leading to theory should not merely condone practice, but should seek rather to improve and direct such practice." Much earlier, Einstein (1938) observed that "science is not just a collection of laws, a catalogue of unrelated facts. It is a creation of the human mind, with its freely invented ideas and concepts. Physical theories try to form a picture of reality and to establish a connection with the wide world of sense impressions. Thus the only justification for our mental structures is whether and in what way our theories form such a link."

The theories of social networking and social capital can enhance our understanding of what happens in online social networks, which can, in turn, become strong business ideas. Some questions these theories raise for me are, for example, How can we point out who the opinion leaders are in your online social network, something that is not always apparent? How can we use the rules and customs that online networks adhere to in creating a more meaningful experience for users?

I think there is a lot of value in looking beyond networks to the social capital that they produce. We need to understand how online social networks already manifest these concepts, and where there is still opportunities to use these theories to create better experiences for users.

PS I have now written the follow-up that I promised earlier in the article - you can view it here: http://www.ux-sa.com/2007/09/structural-holes-and-online-social.html

References:

Adler, P. S. & S. W. Kwon (2000). "Social Capital: The Good, the Bad, and the Ugly". Knowledge and Social Capital - Foundations and Applications. E. L. Lesser. Boston, Butterworth Heinemann.

Einstein, Albert & L. Infeld (1938). The Evolution of Physics. Simon and Schuster: New York.

Lin, N. (2001a). "Building a Network Theory of Social Capital". Social Capital - Theory and Research. N. Lin, K. Cook and R. S. Burt. New York, Aldine de Gruyter.

Lin, N. (2001b). Social Capital - A Theory of Social Structure and Action. Cambridge, Cambridge University Press.

Revzan, D.A. (1951). “Review of ‘Theory in Marketing’ by Cox, R. and Wroe Alderson.” Journal of Marketing 15(3):101-108.

Stay classy, Facebook...

A couple of paragraphs from a TIME Magazine article about Facebook caught my eye this week. First, the ubiquitous observation we see in pretty much every article -- about Facebook's design:

Facebook is cleanly designed and has a classy, upmarket feel to it -- a whiff of the Ivy League still clings. People tend to use their real names on Facebook. They also declare their sex, age, whereabouts, romantic status and institutional affiliations. Identity is not a performance or a toy on Facebook; it is a fixed and orderly fact. Nobody does anything secretly: a news feed constantly updates your friends on your activities. On Facebook, everybody knows you're a dog.

But this next paragraph actually brought up something I haven't thought about before -- that social networks are as much about exclusivity as it is about inclusion:

Every community must negotiate the imperatives of individual freedom and collective social order, and Facebook constitutes a critical rebalancing of the Internet's founding vision of unfettered electronic liberty. Of course, it is possible to misbehave on Facebook--it's just self-defeating. Unlike the Internet, Facebook is structured around an opt-in philosophy; people have to consent to have contact with or even see others on the network. If you're annoying folks, you'll essentially cease to exist, as those you annoy drop you off the grid ... the most important function of a social network is connecting people and its second most important function is keeping them apart.

TIME published another article about Facebook a couple of months ago, where they made a related, also interesting point:

Facebook's News Feed updates me on whom these people have befriended, where they're vacationing, whether they went on a bike ride today, and the like. It's frivolous stuff, but you can see the potential of an online world arranged to emphasize the doings and opinions of those who matter to you most. You can see the pitfalls too, mainly in defining who matters. In the world of Facebook, friends don't drift apart. Either someone makes an active break, or the connection and the News Feeds go on forever. Get used to it.

There is a huge drawback in this binary view of friendship where you are either my friend or you're not, nothing in between. This is not how relationships work in the real world (apologies for calling offline connections the "real world"). There are different levels that is not reflected by this simplistic view of the world. Out there you grow closer to people, you drift apart, you get back in touch, you get mad at each other, you make up, you build a relationship over time... It's probably only a matter of time before online social networking evolves to reflect this real world behavior and give you the flexibility to define the intimacy level of your relationships.

Social Networking approaches for e-commerce Web sites

I came across this pretty cool ethnographic research study on cell phone usage that is also relevant to how we think about community on the Web.  It’s interesting both from a methodological and a findings point of view.  It’s a pretty short deck, so check it out:
http://sfaapodcasts.files.wordpress.com/2007/05/sfaa-2007-metcalf.pdf

This from the authors:

When we talk about the "user experience" the main emphasis is often on an individual's experience with a particular technology. Even with a purported social technology, for example a social networking site, we still tend to create for the individual's interaction with the site (how does someone find their friend, how do they access this site easily from a mobile device).

However, designing for sociability means thinking about how people experience each other through the technological medium, not just thinking about how they experience the technology. The emphasis is on the human-to-human relationship, not the human-to-technology relationship. This is a crucial difference in design focus. It means designing for an experience between people.

Of course designing for an experience between people doesn't mean ignoring the interaction with the device, but it calls for taking something else into account. That "something else" is often another person or people. How do we, as developers of communication technologies, make the communications more interesting, more exciting and more stimulating for the receiver? How do we help our users meet the needs of the other people in their social network? How do we create a shared experience that is equally compelling for all participating parties? When we begin to think like this, we truly start to think of designing social software, social applications, social media.

A lot of e-commerce web sites seem to be scrambling to figure out how to deal with the social networking phenomenon, and in my opinion there are a lot of knee-jerk reactions going on.  E-commerce sites shouldn't try to become social networking sites.  They should leverage their commerce platform to connect people to each other.

A great example is Facebook apps.  eBay has a brand new Facebook application that allows users to connect their eBay profiles to their Facebook accounts.  You can see others' watch lists and even add items to their list if you think they might be interested.  It's also another avenue for sellers to showcase the items they have for sale.  By using its commerce platform to integrate into an existing social networking site, eBay is building on its strength as an online retailer and plugging into an enormous network without re-inventing the wheel by trying to become a social networking site unto itself.

Facebook and MySpace: Comparing Visual Designs

Based on the controversy it stirred up, many of you have by now probably read "Viewing American class divisions through Facebook and MySpace", Danah Boyd's article about the class differences between Facebook and MySpace (she also posted a response to critiques here). I think it is a courageous article, but I'm not going to write about her views here. I want to comment on one particular section that sparked some thinking for me, and it's around the differences between the visual designs of Facebook and MySpace. Danah says the following in her essay:

Most teens who exclusively use Facebook are familiar with and have an opinion about MySpace. These teens are very aware of MySpace and they often have a negative opinion about it. They see it as gaudy, immature, and "so middle school." They prefer the "clean" look of Facebook, noting that it is more mature and that MySpace is "so lame." What hegemonic teens call gaudy can also be labeled as "glitzy" or "bling" or "fly" (or what my generation would call "phat") by subaltern teens. Terms like "bling" come out of hip-hop culture where showy, sparkly, brash visual displays are acceptable and valued. The look and feel of MySpace resonates far better with subaltern communities than it does with the upwardly mobile hegemonic teens. This is even clear in the blogosphere where people talk about how gauche MySpace is while commending Facebook on its aesthetics. I'm sure that a visual analyst would be able to explain how classed aesthetics are, but aesthetics are more than simply the "eye of the beholder" - they are culturally narrated and replicated. That "clean" or "modern" look of Facebook is akin to West Elm or Pottery Barn or any poshy Scandinavian design house (that I admit I'm drawn to) while the more flashy look of MySpace resembles the Las Vegas imagery that attracts millions every year. I suspect that lifestyles have aesthetic values and that these are being reproduced on MySpace and Facebook.

It's that last sentence that got me thinking -- the notion that lifestyles have aesthetic values and that these are reproduced in online identities and the way we use the Internet. I appreciate the sentiment, but I don't think that it paints the full picture. Could it just be that MySpace pages are ugly because users have such control over their pages that they can make it look however they want, and to be frank most people are pretty bad designers? If you look at the color schemes, layout and readability of most MySpace pages, it's pretty horrible, but I suspect it's just because users don't know any better. And the inconsistency everywhere you look is what makes it look so "messy". People's mental models are set up to look for patterns, and when they don't find it (like on MySpace) it leaves them with a pretty uneasy feeling, even if they're not sure what exactly it is that they're feeling...

Facebook, on the other hand, gives users almost no control over look and feel. You have immense control over the content on your page but you're pretty much stuck with what it looks like. There are even certain content containers that you can't move around on the page, which, in my opinion, is a good thing. It means that pages have a consistent visual design and users know what to expect and where to find information, which dramatically increases the ease of use.

When it comes to personalization, you can give users control over design and/or content. MySpace allows both, Facebook allows mostly content personalization. I think Facebook chose the better route...