Can’t believe I’m writing this, but….

No one has more respect for “The Economist” than I so it’s hard for me to believe I’m actually writing a piece critical of something one of it’s writers posted on ( ) At least I have to assume it was a writer for The Economist because The Economist Logo

was included in the Medium post. In addition, when I looked at the page associated with the post it was titled as “Editor of The Economist” .

I suspect my criticism will be quite gentle in the context of the heady issues discussed by the Economist and it’s stable of erudite writers but here goes.

In a article entitled “What Would Happen If Facebook Was Turned Off?” the author wrote;

A social network thrives thanks to increasing returns to scale. The more people on a network, the more potential connections it facilitates and the larger its value to each user….New netizens naturally gravitated to the social network used by most of their friends and family, which reinforced Facebook’s advantages .

While Facebook might be considered a “network” it should be remembered that it’s a “social” network not a telecommunications network so the economies, generally described by Metcalfe’s law, do not apply. Adding another node to a telecommunications network adds value because it increases the switching capability of the network regardless of the substance of what is being switched.

computer use around the world

Economies of scale associated with telecommunication networks do not apply to social networks because simply adding another user is not like adding another node. A new user adds value to existing members only if the new user can contribute substantively to topics of interest to other users.

Telecommunication network switches are agnostic to the substance of what is switched. Social networks are not. In fact the Economist authors almost acknowledge as much in the second sentence quoted above “ New netizens naturally gravitated to the social network used by most of their friends and family” meaning the value of social networks is not in their expanse and growth but almost the opposite; they are valuable because of the services they offer that make it easier to communicated with a limited group of network members known as “friends and family”.

Facebook, like all social networks, offers a set of services that allow users to circumscribe the Internet to network members considered to be “friends”and family. Friends must be “invited to be in a group of friends. The benefits of Facebook have little to do with “network effects” of the Internet and everything to do with affinity services Facebook offers to it’s users.

Rather than judging the value of Facebook by it’s “network effect” it might be better judged by it’s “signal to noise ratio”. A “signal to niose ratio” is a measure that compares the level of a “desiredsignal to the level of undesirable, background noise. Signal-to-noise ratio can be used to refer to the ratio of useful information to false or irrelevant information in a conversation or exchange. For example, in online discussion forums, which is really what groups of Facebook Friends are, off-topic posts and spam are regarded as “noise” that interferes with the “signal” of appropriate discussion. This noise can be information found on the the Internet other than that being discussed by Friends within Facebook groups.

Myspace (stylized as myspɑce) was the largest social networking site in the world from 2005 to 2009. It is headquartered in Beverly Hills, California.

Myspace was acquired by News Corporation in July 2005 for $580 million and in June 2006 surpassed Google as the most visited website in the United States. In April 2008, Myspace was overtaken by Facebook in the number of unique worldwide visitors and was surpassed in the number of unique U.S. visitors in May 2009 but once again Myspace’s value was not technological. It was the affinity of users and the substance of their communications.

Private social networks appear to be on the rise, enticing affluent consumers with the promise of exclusive networking, with many sites only accessible via strict invite-only policies and a “rigorous application process based on education, job title and lots of connections . Launched in 2004, ASmallWorld is perhaps one of the most well known sites for the wealthy, described as ‘MySpace for millionaires’ by Wall Street Journal, promising to connect ‘culturally influential people’. ( )

The substantive features of a social network are so critical to it’s success that they often produce “Confirmation Bias”. Confirmation bias attracts additional users to a social network simply because users enjoy confirming preexisting beliefs and positions. Confirmation bias can be much more of a driver of the success of a social network than any network effect.

A social network does not really thrive thanks to increasing returns to scale. Rather it thrives thanks to the services it offers that users consider valuable in facilitating communications with others they consider to be of value to their outlook and frame of reference. If members of Facabook groups could participate in Facebook conversations without also using the Internet it wouldn’t matter to them how expansive the Internet became.

So now I can breathe again. I’ve been critical of an article in The Economist but appear to be no worse for it. We’ll see. Those erudite Englishmen seem to have a way of getting even and you never know you’ve been “evened”.

Husband for 49 years. Dad forever! Very lucky man.