Lance Tokuda, CEO of Rockyou (a Lightspeed portfolio company) is interviewed over at paidContent.org about apps on social network platforms. Read the whole thing.

As I read the coverage about the real money trade in MMOs panel at GDC, I was reminded of danah boyd’s thoughts on why MySpace took off and Friendster did not, which notes in part:

Friendster killed off anyone who didn’t conform to their standards, most notably Fakesters and those with more creative non-photorealistic profiles. When MySpace users didn’t conform, they were supported and recognized for their contributions to evolving the system.

A good analogy to both situations is what to do when faced with a nice green lawn on a college campus. Some students will always cut across the grass, leaving worn paths. There are three solutions to this problem:

(i) Erect a fence around the lawn and put up some “keep off the grass” signs. This keeps the grass green and pristine, exactly as the landscape architect imagined it, but forces unhappy students to go the long way around to their classes.

(ii) Do nothing, let students cut across the grass and tramp mud into classrooms.

(iii) Pave the paths. Students take the shortest paths, no mud in classrooms, and the rest of the lawn stays green.

Friendster put up “keep off the grass” signs. Myspace paved the paths.

Now if you ask students as to what should be done about the muddy paths, they’ll probably suggest option number one. But its those same students that created the paths in the first place! It is more important to watch what users do than what they say. Facebook is facing a similar dilemma with its apps right now.

Games companies have the same issue with virtual goods. The abundance of real money trading markets for virtual goods tell us what users want to do (despite their vociferous claims to the contrary). If game developers don’t pave these paths, they risk muddy classrooms or unhappy students.

Lightspeed hosted a summit for portfolio companies and friends of the firm in the fall, focused on consumer internet user acquisition. One of the panels was about building community on a social media site, and on that panel Angelo Sotira (CEO and founder of deviantART) noted that for social media sites, culture is a function of UI. (deviantART is the leading community for artists and their fans on the web, and is an Alexa top 100 site. [Disclosure: my wife did some consulting for deviantArt.])

I was reminded strongly of this when reading Judith Donath’s paper on Signals in Social Supernets that was published in the special theme issue of JCMC on social network sites guest edited by dana boyd and Nicole Ellison:

Variation in the design of SNSs promotes the development of different cultures (Donath & boyd, 2004; Lampe, Ellison, & Steinfield, 2007; Lenhart & Madden, 2007b). On a site where creating a link involves little cost, users may amass thousands of “friends,” but an observer has no way of knowing which, if any, of these links represent a relationship between people who care about or even know each other (boyd, 2006; Fono & Raynes-Goldie, 2007). On Orkut, for instance, one simply clicks on a profile to request a connection, and being connected provides no special access or information.

On sites with higher costs for creating a link, the observer has reason to believe that the links represent genuine relationships. Members of aSmallWorld are careful to request connections only with others whom they are sure wish to be linked to them, since they can be banished for having a few link requests declined (Price, 2006). On LiveJournal, making the link is easy: It is one of the few sites in which this can be done unilaterally. However, linking is generally done to give someone access to part of one’s journal, and linked members’ posts appear on one’s own space. This makes “friend” a relatively significant signal, as friending someone both reduces one’s privacy and publicly connects one with that person’s writing (Fono & Raynes-Goldie, 2007).

The meaning of these links is also personally subjective. For some people, listing someone as a “friend” on a social network site is an indication of personal and positive acquaintance. Others are far more casual, willing to add friends indiscriminately (boyd, 2006). This has ramifications for the reliability of the profile itself. Viewers may trust the self-created content of a profile if they believe that its links are to people who know that user well, while links that they believe have only minimal connection add little credence.

SNSs are designed for different audiences. LinkedIn is for professionals. It has no photographs, the profiles are resumés of education and work, and the comments are in the form of testimonials from co-workers. Identity is firmly tied to one’s professional self, and there is limited ability to explore other people’s networks. MySpace, popular with young people, has a very different atmosphere. Its profiles feature photographs, music, and embedded programs, and users can explore the network far beyond their own acquaintances (although they can choose to make their profile visible only to direct connections). This open interface makes it a rich environment for the jokes, links, and software that function as information fashions (discussed below).

Identity in MySpace is fluid. Some profiles are real people, presenting themselves much as they would offline. Some are commercial entities, such as bands, charitable organizations, or celebrities; still others are fictional personas, made for creative experimentation or as fronts for spam. No single design is ideal for all sites. What is important is that designers be fluent in not only the fonts and colors that make up the graphical design of the site, but in the social costs and benefits that shape its emerging culture.

Once a culture takes hold on a site, it is very hard to change. People building social media sites should be careful to think through the implications of their UI (including such mechanics as keeping score and exposing popularity) as their choices will likely have long term implications that can’t be easily reversed by a subsequent tweak to UI.

I’d love to hear other examples of sites where the dominant culture is a function of UI.

UPDATE: Bokardo has a good related post on how changes to Digg’s UI changed its culture

Interesting article yesterday from the NY times that outlines some of the research findings on Facebook users (spotted via Bokardo).

Some interesting quotes from the article:

Researchers learned that while people perceive someone who has a high number of friends as popular, attractive and self-confident, people who accumulate “too many” friends (about 800 or more) are seen as insecure…

Eszter Hargittai, a professor at Northwestern, found in a study that Hispanic students were significantly less likely to use Facebook, and much more likely to use MySpace. White, Asian and Asian-American students, the study found, were much more likely to use Facebook and significantly less likely to use MySpace…

Two interesting posts recently address the issue of the number and strength of online relationships within social networks. Andrew Chen notes that friendships are complex:

…friendship networks are actually very complex, and are poorly approximated by the “friends” versus “not friends” paradigm, or even the “friends”, “top friends”, and then “not friends” paradigm…

… in fact, once you have this social map drawn out, one of the most interesting questions you can ask people is how they figure out in what situations they should:

* call someone
* text someone
* e-mail someone
* poke them
* write on their wall
* write them a message
* meet them in person
* etc

…there’s a steady progression of “commitment” that it takes to go from writing on a wall (the least burdensome thing) versus meeting them in person (the most burdensome thing). In fact, one of the really useful things that social networks provide that e-mail doesn’t is a range of expressiveness in your communication such that you can use it for more things than sending notes or data across the wire.

danah boyd reaches related conclusions as she thinks about the value of inefficiency in communication.

Social technologies that make things more efficient reduce the cost of action. Yet, that cost is often an important signal. We want communication to cost something because that cost signals that we value the other person, that we value them enough to spare our time and attention. Cost does not have to be about money. One of the things that I’ve found to be consistently true with teens of rich and powerful parents is that they’d give up many of the material goods in their world to actually get some time and attention from their overly scheduled parents. Time and attention are rare commodities in modern life. Spending time with someone is a valuable signal that you care.

When I talk with teens about MySpace bulletins versus comments, they consistently tell me that they value comments more than bulletins. Why? Because “it takes effort” to write a comment. Bulletins are seen as too easy and it’s not surprising that teens have employed this medium to beg their friends to spend time and write a comment on their page.

Andrew found that sending or accepting a “friend” request was one of the least effort ways of communicating online (especially now that sending friend requests has largely been automated via email import tools). This leads to “friend” lists quickly growing to a size well over 150, Dunbar’s number, the theoretical maximum number of individuals with whom a set of people can maintain a social relationship. So interestingly enough, marking someone as a “friend” in a social network is not a terribly good test of whether or not they are actually a friend.

Mining implicit data on behavior to create this structure is actually a better indicator of the real strength of relationships. Xobni does this via email; do any readers know of any third party systems that do this for social networks?

Last month dana boyd and Nicole Ellison were guest editors for the Journal of Computer-Mediated Communication in a special theme issue on social network sites. One of my favorite papers was by Hugo Liu at the MIT Media Lab who investigated how social network profiles act as taste performances.

Liu surveyed over 100,000 random myspace profiles, paying particular attention to the stated lists of interest (music, books, movies, TV shows, heroes and general interests). And the winners are…

Favorite Book: The Da Vinci Code
Favorite Music: Radiohead
Favorite Movie: Fight Club
Favorite TV Show: Family Guy
Favorite Hero: Mom
Favorite Other Interest: Music

See the whole list below, by category (click to read):

Aside from idle curiosity, Liu notes that these interests also constitute “taste statements” for the profile owners:

The materials of social identity have changed. Up through the 19th century in European society, identity was largely determined by a handful of circumstances such as profession, social class, and church membership. With the rise of consumer culture in the late 20th century, possessions and consumptive choices were also brought into the fold of identity. One is what one eats; or rather, one is what one consumes—books, music, movies, and a plenitude of other cultural materials.

New emphasis on taste and cultural consumption frees identity from some of its traditional socioeconomic limitations. The milieu of cultural interests one creates for oneself can even be transformational, because cultural consumption not only “echoes” but also actively “reinforces” who one can be. In the pseudonymous and text-heavy online world, there is even greater room for identity experimentation, as one does not fully exist online until one writes oneself into being through “textual performances”.

One of the newest stages for online textual performance of self is the Social Network Profile (SNP). The virtual materials of this performance are cultural signs—a user’s self-described favorite books, music, movies, television interests, and so forth—composed together into a taste statement that is “performed” through the profile. By utilizing the medium of social network sites for taste performance, users can display their status and distinction to an audience comprised of friends, co-workers, potential love interests, and the Web public. Although social network sites are relatively new, SNP taste performance can be seen as an instance of what sociologist Erving Goffman termed everyday performance. Successful performers are “aware of the impression they foster.” Thus, taste statements need to be crafted so as to stand up to the scrutiny of an audience that is able to “glean unofficially by close observation”.

Essentially, on a social network profile, saying what you like defines who you are, not just to yourself, but to others. Liu’s primary findings were that:

1. Taste is not random, but rather is guided by aesthetic preferences across interpretable axes. For example, the two dimensions: (i)utopian-vs-dystopian and (ii)sincere-vs-satirical, explain over one quarter of all the variation of taste in books. The two dimensions; (i) sexy-vs.-funny and episodic-vs.-saga structure, explain over one quarter of all the variation of taste in TV. If these axes are indeed opposable, it raises the question; is it possible to be both sexy AND humorous in MySpace?

2. Many MySpace users craft their interest list with a view towards “looking good” to a particular audience (Liu calls this “prestige”). He found that “coherence” among stated interests was much higher for both those with extremely popular interests, and those with extremely rare interests, than for average users. This suggests that people in both cases are deliberately constructing a clear message that they belonged to either the popular culture, or a particular sub-culture, and self censored other interests that might obscure their message.

3. Some MySpace users craft their interest list to differentiate themselves from their peers. Users’ interests tended to be more dissimilar from their “Top 8″ friends’ interests than would be expected to happen by chance. While it is possible that users tend to friend those who complementary tastes, it is more likely that they craft their profiles with an awareness of their firends’ profiles so as to be unique.

4. Musical interests play a dominant role in taste and identity. There was far more variability in music interests than in the other categories. Indeed, it seems as though specificity in music interest is far more valued than genre or any other factor.

While these conclusions may not be surprising, it is helpful to have empirical evidence, rather than simply asserting them to be true, which the typical blogger pundit is wont to do.

This afternoon I spoke to the Stanford class on Creating Engaging Facebook Apps.

As I said at Web 2.0 expo, building big businesses online is hard work. While it isn’t hard to start an app company, especially as a single developer ($250k in revenue) or even to support a small team ($2.5m in revenue), it gets quite hard to scale revenues to $25m/yr.

Assuming a 5% daily active rate and 3 pageviews per visit, an app developer with a $0.50 RPM would need to get to 926m installs to get to $25m run rate. Compare that to the app with the most installs on Facebook - Slide’s Superwall which has around 20-21m installs. Clearly, broad reach app developers need to develop (i) multiple (ii) high engagement apps [ie higher active rates and pageviews/visit than these assumptions] (iii) across multiple social networks to be able to get close to this revenue target. (RPMs will likely be higher for companies with a direct sales force as well, so the target isn’t quite as high, but you get the point).

Under the same activity and pageview assumptions, an app developer with a $10 RPM would need 46m installs to get to $25m in revenue. Apps with endemic advertising opportunities can easily realize this level of RPM but will still need to be in multiple social networks to get to those levels of installs. It doesn’t make sense to limit your world to being a Facebook app. Social network platforms are avenues for distribution, and app developers should be taking advantage of all of them.

One of Lightspeed’s portfolio companies, Rockyou, is taking the former approach. Another, Flixster, is taking the latter. Both seem to be working so far.

I also did a similar analysis for digital goods business models in the presentation. Here is a link: Stanford Facebook Class presentation

Bokardo notes a set of social design best practices as recommended by the Google OpenSocial team:

1. Engage Quickly - (my interpretation: provide value within 30 seconds)
2. Mimic Look and Feel - (make your widget look like the page it is in)
3. Enable Self Expression - (let people personalize their widgets)
4. Make it Dynamic - (keep showing new stuff)
5. Expose Friend Activity - (show what friends are doing)
6. Browse the Graph - (let people explore their friends and friends of friends)
7. Drive Communication - (provide commenting features)
8. Build Communities - (expose different axes of similarity)
9. Solve Real World Tasks - (leverage people’s social connections to solve real problems)

Worth reading the full text from OpenSocial

Yesterday was a very good day for app developers with the official launch of Open Social. A particularly good day for Flixster (a Lightspeed company) which was on stage with MySpace, Google, Ning and others for the launch, and was the sample app used in many of the demos.

With so many platforms opening up, resource constraints are the key problem for many app developers. There are plenty of great opportunities, but they don’t have enough people to pursue them all. They are forced to make choices and prioritize.

Open Social helps a lot in that you can “learn once, run anywhere”. While it isn’t “write once, run anywhere”, the resource commitments required to support multiple social networks are much lower. As Andreessen notes:

As an app developer, you have three options:

* You can write purely to the Open Social API. If you do this cleanly enough, your app will run unchanged in any compliant Open Social container. (Google is actually not making this claim — they’re calling Open Social “learn once, write anywhere”, which is not the same as “write once, run anywhere”. But in practice, the API is simple enough that “write once, run anywhere” should work just fine.)

* You can write an app that is specific to one container. For example, there may be some apps that make sense only in LinkedIn — business-related apps, say. There may be other apps that make sense only in Ning — apps that presume that users are creating their own social networks, say. And there may be yet other apps that only make sense in Salesforce.com, which will also be an Open Social container. In those cases, you are targeting your app to one specific container, and so using whatever additional APIs that particular container provides, in addition to the Open Social APIs, is a no-brainer.

* Finally, you can write an app that behaves differently depending on which of several containers it’s running in. Your app just discovers which container it’s running in, and then does whatever it wants on a per-container basis.

No standard can possibly anticipate all of the different use cases and scenarios people will think up. Standards that try to anticipate all of the different use cases fail, because they are too complex and generally impossible to implement. Standards that standardize behavior that is clearly standard, while leaving open the ability to innovate on top, succeed. The history of this kind of thing is quite clear, and Open Social is on the right side.

For smaller social networks, joining Open Social is a no brainer. But MySpace is big enough that app developers would have written for its platform regardless of whether or not it was part of Open Social. So why did they join?

It comes down to the competition for app developer’s time and resources. In the few months since Facebook opened up its platform, Myspace has seen its lead eroded from being 3x as big to just 2x as big. Facebook was winning more users, and more share of user time, because app developers were adding new features to the Facebook experience much faster than Myspace could do on its own.

If Myspace had stayed out of Open Social, there would have been three platforms competing for developer time. By joining, there are now only two, and one (Open Social) provides potential access to far more users than the other. More developer time would be spent on Open Social, and MySpace would benefit more from the improved rate of innovation.

MySpace also knows that it can win more developer mindshare relative to other participants in Open Social if they help the developers make more money. It has a better developed sales force and ad network than many of the other participants, and if it opens up access to that salesforce to app developers, then you’ll see even more developers focusing even more of their time on Myspace (at the expense of Facebook and the other Open Social participants). If they were to go so far as to guarantee a minimum CPM for “canvas pages” on Myspace, then they’d see a surge of developer interest.

This will require a significant mindshift for Myspace which has traditionally not wanted other companies to monetize pageviews within Myspace, let alone helping them monetize. If they make the shift, MySpace will not have given anything up by joining Open Social. Rather, they will have gained something. They will be the place that app developers can make the most money, and hence be their first priority. The increased stickiness and loyalty to Myspace will accrue to Myspace alone.

Breaking news tonight about Google teaming up with several social networks to create a set of standards for application developers. The NY Times says:

On Thursday, an alliance of companies led by Google plans to begin introducing a common set of standards to allow software developers to write programs for Google’s social network, Orkut, as well as others, including LinkedIn, hi5, Friendster, Plaxo and Ning.

According to Techcrunch:

OpenSocial is a set of three common APIs, defined by Google with input from partners, that allow developers to access core functions and information at social networks:

* Profile Information (user data)
* Friends Information (social graph)
* Activities (things that happen, News Feed type stuff)

Lots of discussion on the web about it.

This is great news for widget and app developers like Flixster and Rockyou (both Lightspeed companies) as the burden of building apps for multiple platforms can quickly get overwhelming for the resources of a small company. It’s also great news for the largely “second tier” social networks (in terms of US users) that are members of the network.

According to Venturebeat, Facebook was invited but declined to join. Not a big surprise.

Open networks like this benefit smaller players. It’s simple math. Lets say you’re a social network with N members. You’re looking to join a coalition of other social networks to create an open standard; in aggregate they have M unique users. Your benefit is proportional to M and your cost is proportional to N. So the cost is greatest when N is large (big social networks will have app developers jumping at the opportunity to develop for their users anyway) and smallest when N is small (as they probably would not get a lot of apps developed for them on a standalone basis otherwise).

This same scenario has played out whenever there have been dominant closed platforms. Windows remain relatively closed (with dominant market share) while Linux embraced openness. AOL tried to stay closed (using its proprietary Rainman programming language) while small web sites embraced the openness of the web. Anil Dash had a good post covering this history earlier

Historically, openness has taken share against (even large) closed networks because M keeps getting bigger and bigger and more developers get encouraged to write for the platform.

Also historically the biggest owners of closed platforms have been slow to embrace openness, if they ever did at all.

The other variable in this case is how friendly each social network is to app developers making money. It isn’t enough to get a lot of users on a platform if you can’t get paid. Rockyou and Slide both shifted their efforts from the larger Myspace to the smaller Facebook when Facebook opened up because they could make money from Facebook but not from Myspace.

We’ll see if past is prologue!