Social Quitting

🌈 Abstract

The article discusses the rapid decline of social media giants like Twitter and Facebook, after decades of growth. It explores the reasons behind this phenomenon, focusing on the concept of "network effects" and how it can work both ways - driving rapid growth as well as rapid decline. The article also delves into how social media companies have exploited high switching costs to capture more value from users and advertisers, leading to a deterioration in the user experience. This, in turn, has accelerated the exodus of users from these platforms.

🙋 Q&A

[01] The Decline of Social Media Giants

1. What are the key reasons behind the rapid decline of social media giants like Twitter and Facebook?

• The article suggests that the rapid decline is due to the concept of "network effects" - where a system becomes more valuable as more people use it, but also becomes less valuable as it sheds users.
• As social media companies like Facebook and Twitter cemented their dominance, they steadily changed their services to capture more value from users and advertisers, leading to a deterioration in the user experience.
• High switching costs (the difficulty of leaving a platform and losing connections/communities) allowed these companies to abuse users, as users felt they had no choice but to stay.
• However, once the benefits of using these platforms no longer outweighed the costs, users started to leave, triggering a rapid collapse due to inverse network effects.

2. How did social media companies exploit high switching costs to their advantage?

• Social media companies made it very difficult for users to leave their platforms by aggressively litigating against upstarts that enabled users to stay in touch with friends without using their services.
• They also steadily reduced the ability to interact with their platforms through third-party apps and APIs, making it harder to leave without losing the value provided by the platform.
• This high switching cost allowed the companies to make the user experience worse by increasing surveillance, ads, and other negative aspects, as users felt they had no choice but to stay.

3. What role did network effects play in the rise and fall of social media giants?

• Network effects were a key driver of the rapid growth of social media platforms, as more users joining made the platforms more valuable.
• However, network effects also work in reverse - as users leave, the platform becomes less valuable, triggering a rapid decline.
• The article suggests that once the benefits of using these platforms no longer outweighed the costs, users started to leave, setting off a cycle of inverse network effects that led to the rapid collapse of the social media giants.

[02] The Future of Social Media

1. What is the author's view on the long-term sustainability of social media platforms?

• The author suggests that the social media giants that are "circling the drain" today had a very long run, but ultimately their ability to exploit high switching costs and capture value from users and advertisers led to a deterioration in the user experience.
• Once things got "just a little worse", advertisers and users started to quit, triggering the long-delayed collapse of these platforms, similar to the fate of earlier social media networks like MySpace and Bebo.
• The author implies that the current social media giants may not be able to sustain their dominance in the long run, as the balance between the benefits and costs of using these platforms shifts.

2. What does the author suggest about the future of social media?

• The author does not make any explicit predictions about the future of social media, but the article suggests that the current model of social media platforms exploiting high switching costs and user/advertiser surplus may not be sustainable in the long run.
• The rapid decline of the current social media giants could pave the way for new models or platforms that better balance the needs of users, advertisers, and the platform itself.