"The Internet economy has been built on the network effect (i.e. the effect that one user of a good or service has on the value of that product for other people). Investors and entrepreneurs have treated this like Moore's Law. But just as Moore's Law hits physical constraints, network effects have a limit in many types of online communities. Indeed, in some cases, a reverse network effect may exist: as new people join, others are motivated to leave. This dramatically affects the length of the competitive advantage enjoyed by these ventures."
I wonder too how attempts to move a SNS like Fb away from its initial success by, for example, opening the network to those who want to sell you something increase the likelihood that the sense of community is lost, or that the value of social contacts diminishes. In other words, it is not just scale, but the types of characters that flock to the network...
