jump to navigation

Social Media: Open platforms and distribution are opposite sides of the same coin May 28, 2007

Posted by jeremyliew in business models, Consumer internet, distribution, Ecommerce, Internet, media, social media, social networks, user generated content, viral, viral marketing, web 2.0, widgets.

As I’ve said in the past, I think that distribution is the most important success factor in the early stages of any new consumer technology. Distribution used to mean getting a carriage deal done with a big portal. These days it can take a number of forms, but it always requires getting in front of potential users who may not be aware of you, and alerting them to your value proposition.

As social networks take an increasing percentage of internet users time, it’s more important than ever to factor them into a distribution strategy. Within Myspace, this has been through widget virality (one of the seven forms of virality that we’ve posted about in the past). Bebo has taken a more controlled approach, allowing select partners into their system in what looks closer to a traditional portal distribution deal.

Now, through its new platform, Facebook too can be a distribution platform. Apps are spreading in Facebook through a combination of virality from profile pages, promotion to existing user bases and position in the application directory, with iLike being the clear early winner. Happily for Lightspeed, Rock You and Flixster (both are portfolio companies) have three of the top ten apps on Facebook between them. Josh Kopelman says that Facebook’s open approach to partners has effectively increased their virtual R&D budget by around $250m, the amount invested so far into widget companies.

Another of our portfolio companies, Stylehive, is also taking the approach of opening up its platform (albeit on a smaller scale to Facebook). They are partnering with retailers and publishers, including the Gap, Shopbop, Instyle Magazine, Gen Art and others, inviting them into the Stylehive platform. These partners will be able to access Stylehive’s community as well as add a social media dimension to their commerce or content.

I think we’ll see even more communities opening themselves up as platforms over the next 12-18 months. It will be especially interesting to watch MySpace’s competitive response.


1. Ron - May 29, 2007

I’m still not convinced that any of this really gets people any closer to being able to actually do anything other than trade their friends as baseball cards.

It doesn’t really enhance anything. Sure it looks nice. And it makes people think theoretically about what “could be” if all of these so-called ‘open’ modules were really, truly ‘open’ and accessible to people in the same way that blogging software and HTML allowed any .02 hack with something to say, to basically say it.

But I’m not convinced they’re part of any sort of revolution, when open source tools were around and thriving well before all of these proprietary sites decided that “hey, we’ve been ripping off open source code forever, why not ‘give back’ while finding a way to keep people addicted to what we’re feeding them.”

2. Cate Long - May 30, 2007

Distribution is everything… in my business, the fixed income market, you want to connect as many places as possible… (in fact the most complicated part is keeping all the connections accurate in real time…)

I’m watching Lending Club launch on Facebook … interesting financial service app… I’m wondering what kind of takeup they can get…

Lending Club is a “higher order” application in that its a service and much deeper than posting photos or sharing about music… so can platforms like Facebook sucessfully distribute richer applications? And will viralness take effect there… watching… wondering…

3. Facebook is the new AOL? ouch at Matt MacQueen - June 29, 2007

[…] Really ready go jump off the deep end?  Read this: Social Networks are just distribution strategies. […]

4. Four factors determine how much a Facebook app is worth « Lightspeed Venture Partners Blog - July 3, 2007

[…] Charlie O’Donnell at Oddcast concurs, he says to app developers “Facebook doesn’t owe you a business model” – you still have to figure that out on your own, and points out that the customer acquisition is a pretty big benefit. As I’ve blogged about in the past, open platforms and distribution are two sides of the same coin. […]

5. noksskitraree - March 7, 2009

продам Форд-Фокус 2008 года за 200 тр. торг возможет. срочно!!!
+7 960 200 9209

6. Social gaming is a tactic not a category « Lightspeed Venture Partners Blog - March 25, 2009

[…] start with games played on social networks. This is a terrific distribution tactic as open platforms and distribution are opposite sides of the same coin, and as I’ve said in the past, in the early stages of a new category distribution is the key […]

7. Facebook needs 2-way flow, or it becomes AOL? « MM - April 29, 2009

[…] Credit reading — Social Media: Open platforms and distribution are opposite sides of the same coin and Steve Rubel on Walled Gardens and the Lesson for Social Networks. Rubel says: For all of the […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: