Separately from the disease analogy, Facebook could exhibit reverse network effects on the way down.
Brad Burnham & Fred Wilson have also talked about reverse network effects.
And, as I have said before, network effects help on the way up and hurt on the way down. If I get great single person utility from your service, it is less likely that I will follow my friends out of it when your service ends its stay on the hype cycle and the iTunes leaderboard
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Here are some background reading from the Social Network Researcher Danah Boyd:
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Social networks appear to be a very peculiar business—one in which
companies might serially rise, fall, and disappear.
Danah Boyd, a senior researcher who studies social networks at
Microsoft Research, attributes their instability to the way users can
bind themselves by race and class, taste and aesthetics. Influential
peers pull others in on the climb up—and signal to flee when it’s time
to get out. “The thing about user adoption and user departure is that
it’s not a steady flow,” says Boyd. “Think of it as, you’re knitting a
beautiful scarf, and you’re knitting and knitting, and you get a
bigger and bigger scarf. Then someone pulls a loose thread at the
bottom. And it all unravels….
“Facebook did a fantastic job of hiding behind the panic around Myspace and basically saying, ‘We’re totally safe,’ ” says Boyd.
Myspace’s inability to build an effective spam filter exacerbated the public impression that it was seedy. And that, says Boyd, contributed to an exodus of white, middle-class kids to the supposedly safer haven of Facebook—a movement she compares to the “white flight” from American cities in the second half of the 20th century. Myspace was becoming Detroit.
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Here is a link from Fred talking about Single User Utility in a Network: http://www.avc.com/a_vc/2012/12/single-user-utility-in-a-soc...
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And, as I have said before, network effects help on the way up and hurt on the way down. If I get great single person utility from your service, it is less likely that I will follow my friends out of it when your service ends its stay on the hype cycle and the iTunes leaderboard
---
Here are some background reading from the Social Network Researcher Danah Boyd:
http://www.businessweek.com/magazine/content/11_27/b42350539...
--- Social networks appear to be a very peculiar business—one in which companies might serially rise, fall, and disappear.
Danah Boyd, a senior researcher who studies social networks at Microsoft Research, attributes their instability to the way users can bind themselves by race and class, taste and aesthetics. Influential peers pull others in on the climb up—and signal to flee when it’s time to get out. “The thing about user adoption and user departure is that it’s not a steady flow,” says Boyd. “Think of it as, you’re knitting a beautiful scarf, and you’re knitting and knitting, and you get a bigger and bigger scarf. Then someone pulls a loose thread at the bottom. And it all unravels….
“Facebook did a fantastic job of hiding behind the panic around Myspace and basically saying, ‘We’re totally safe,’ ” says Boyd. Myspace’s inability to build an effective spam filter exacerbated the public impression that it was seedy. And that, says Boyd, contributed to an exodus of white, middle-class kids to the supposedly safer haven of Facebook—a movement she compares to the “white flight” from American cities in the second half of the 20th century. Myspace was becoming Detroit. ---