Supported Browser
  • About Us
  • Subscribe
  • Contact us
Marketing - BLOG

Multi-Homing on Social Networks

Miklos Sarvary, Carson Family Professor of Business at Columbia Business School |

Facebook is not going to become irrelevant just because its users also browse other social networks

A recent Pew survey cited in this FT article confirms that about 40% of adults divide their time between Facebook and another social networking platform. Professionals tend to spend a significant amount of time on LinkedIn besides Facebook (not a surprise) and a large proportion of women tend to use Pinterest besides Facebook.

This is consistent with economic theory applied to platform competition in the presence of local (as opposed to global) network effects. Our paper with Kaifu Zhang, currently at CKGSB, describes exactly this phenomenon and analyses how it may manifest itself in the presence of a 'dominant site' such as Facebook. If time spent on a platform relative to that spent on others is the relevant measure of market power, then worrying about Facebook's dominance has always been misplaced.

Can Facebook really be anything to anyone over the Internet? Not really... Similarly, I find silly the recent arguments that Facebook is becoming increasingly irrelevant because young people spend more time on chatting sites and less time liking each other’s posts. People seem to look for another big thing to which everyone is likely to migrate. But the dynamics of the Web are strongly influenced by local network effects meaning that it is an ecosystem of strong platforms rather than one big site that is likely to dominate social networking. Facebook, with its billion plus active members is certainly a strong candidate to be part of this ecosystem. However, worries about adequate revenue models for the firms in the ecosystem are well justified: it is still not clear how such a fragmented attention base can be efficiently monetised. 

 

Add a comment Already a member?
We welcome your comments and encourage lively debate. However, to ensure the quality of discussion, our moderators reserve the right not to publish personal attacks, abusive comments or overly promotional content. You can view our Terms & Conditions
CAPTCHA
This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.

Your Privacy

INSEAD takes your privacy very seriously. For this reason, we inform you that the data collected via the form above is processed electronically for the purpose(s) specified in this form and will not be used outside this framework. In accordance with the Data Protection Act of 6 January 1978 amended by the GDPR, you are granted statutory rights of access, modification, update, deletion and limitation of treatment of your personal data. You may exercise these rights at any time by writing or sending an email to INSEAD at insead.knowledge@insead.edu. You have the right, on legitimate grounds, to object to the collection and processing of your personal information. For more information, please see our privacy policy.