I am talking my position here, but this will be big in 2006 and beyond. Old models have been revamped and the opportunity cost to new and established brands is too large to ignore.
Social Networks 3.0
By David Hornik on December 4, 2005 07:16 AM | Permalink | Links In | Print | Comments (12) | TrackBack (0) | Categories: Consumer Internet & Media and Internet Infrastructure and Podcast
I have received a lot of calls recently from reporters interested in discussing social networks. It reminds me of the set of calls I got way way back in 2004. The reporters today want to know what I think of social networking companies and if the venture capital community remains excited about social networks. I certainly don’t claim to speak for the venture capital community. But I am happy to share with them my thinking about social network. And, while a well tread topic here at VentureBlog, it may be worth revisiting social networks given the ongoing activity in the space.
For those of you who have long commutes, or are joggers, or simply prefer the sonorous tones of my voice, you can check out my podcast on the topic at VentureCast. For the rest of you (and those of you who have complained that you think I’m being lazy by recording my thoughts rather than writing them) let me take a second to share my thinking on the evolution of social networks.
Let me simply start with this. I am a huge fan of the fabric of social networking. I believe that it makes up a crucial piece of the online communication that is driving the consumer web experience. But I do think that social networks have undergone an significant and important evolution, even since 2004, which will continue to pay dividends for end users.
For what it is worth, to my mind we are now experiencing Social Networks 3.0.
Social Networks 1.0 were built during the late 1990s to enable the initial set of consumer services that created such excitement about the promise of the web. Services like eGroups/OneList, ICQ, Evite and many many more relied upon groups of users organizing and communicating on the web through coordinated networks. Those networks were not explicitly described as such but they were the underpinnings of these communications platforms.
Social Networks 2.0 began in the early 2000s when entrepreneurs got to thinking about the nature of their online networks and the power that could come of making those networks explicit. Services like Friendster, Tribe, Orkut, LinkedIn, Spoke emerged to allow users to organize their recreational and business networks. The focus of those services as they were first built was to enable the creation, growth and management of an explicit social network. In other words, the consumer experience of Social Networks 2.0 was around the creation and discovery of the network itself, rather than a particular use of that network.
I believe that we are now in Social Networks 3.0. After a fair bit of excitement and energy around pure play social networks, it became clear that the building and management of a social network was not, in and of itself, a compelling consumer experience. In a nod back to the earliest instantiations of social networking, entrepreneurs have come to realize that social networks are enablers of other compelling consumer experiences. Thus, social networks are becoming an important ingredient of all sorts of consumer experiences. Social networks inform the conversations that take place among friends on LiveJournal. Social networks enable the discovery of new music on MySpace. Social networks enhance the multi-player gaming experience at Xfire. Social networks now empower recruiting on LinkedIn. And dozens of new social networks are emerging to enable specific, valuable consumer experiences that are enhanced by the underpinnings of the network.
I am more than a little excited about Social Networks 3.0 because I believe that social networking will be a crucial element of virtually all online consumer experiences going forward. And truly compelling online consumer experiences will always make successful companies. Thus, I look forward to seeing how social networking continues to evolve. I see great things in the future for Social Networking 4.0, whatever that ends up being.