This is a monumental work, which I’ll publish in several parts (even the course notes for it will be huge).
Part 1 Part 2 Part 3
Two Major Principles
People are status-seeking monkeys.
People seek out the most efficient path to maximizing social capital.
Social media networks (SMN) generate more social capital than financial capital, especially in their early stages.
Social capital is a leading indicator of financial capital.
The output of SMNs is the status.
Status is the reason people come and stay in SMNs, especially early on, when there are limited network effects.
Traditional competition on raw utility is clear and ruthless; enabling status competition is far from straightforward with seemingly unpredictable value of items.
Social Networks are Like ICOs
Every new social network issues a new form of social capital (a token).
You much show proof of work to earn a token. Status is not valuable if it’s easy to achieve (or it becomes participation trophy). Requires skills, of course.
Built-in scarcity: over time getting tokens becomes harder. Initially it’s much easier to build following. Later competition for attention intensifies.
Many people don’t “get them” :)
Earned and Pre-Existing Social Capital
One earns social capital from exposure (views), interactions (likes, reposts, comments) and longevity.
Existing celebrities bring their exogenous social capital from real life, and their social capital is transferable between platforms if they have general fame.
Thirst for status is potential energy.
Social Capital ROI
Many people put a lot of effort into learning how to maximize exposure / get retweets, etc.
Visual mediums work better for a younger audience.
Different SMNs put different weights to social ROI.
Pure graph-based social capital allocation mechanisms may backfire when accounts with large following become even larger creating a disincentive for smaller accounts to invest into content / engagement with the platform.
SMNs must always prioritize the “best” content to avoid stagnation and create “social lifts”.
Also, new accounts’ content needs to be analyzed for engagement, velocity (time to X followers) and distributed fairly for them to feel sufficient return on their work.
Copycat networks (with minor twists) make it equally hard to earn status on the existing proof of work —> why bother with putting effort into the same game?
Better if the status game is better, or the status is more valuable —> leads to another dimension of pure utility.
Copycats are not protected from incumbents copying their key features and deploying those features to their extensive and dominant graph. Copy and throttle.
Copying a feature doesn’t mean the graph is also being copied (not!). Competitive advantage requires both.
to be continued…