Archive for June, 2011 ushering in a new era of social music

The fast growth of is based on the active participation, often additive participation, of users which has effectively built the first ever social music site that is focused on sharing and listening to songs, rather than browsing archives of what people have listened to in the past (in the case of, acquired by CBSi for $260 million). Sure, companies like Rdio and Spotify are also dabbling in the social music space but their model is more passive listening than active participation.

My personal theory is that social web 2.0 sites have found ways to maximize/monetize the active participation model. Take a look at Yelp. It’s essentially a personal blog for food and reviews by friends. Before Yelp, you had critic reviews (ZAGAT, CitySearch, etc) but nothing that involved active user participation. People inherently find other people’s reviews (esp. their friends reviews) useful about places and things.

Obviously the company that has found the most value in active participation, and thereby success, has been Facebook. But rather than dive into details and criticize them for capitalizing on social status, limited initial access and transferring private information to third party applications, let’s consider the companies that were on a level playing field with Facebook. That would be MySpace. Let’s consider why MySpace is doomed for failure and why the same rules don’t apply to Facebook. The widely held belief, as with any social website, are that switching costs are low and privacy concerns are high. But you would be a fool to actually believe that. The real reason why MySpace died is simply two fold: poor business strategy and horrible user experience. Privacy is a big concern for users, but then again, Facebook only transfers your information when you allow it to. Technically speaking, privacy is your concern and your decision. For Facebook to change its privacy rules, either users have to file a lawsuit based on some factual data about misuse or the government has to get involved to protect people’s privacy. Who likes big brother telling you what to do? I don’t. People should be less naive.

The second commonly held belief is low switching costs. Let me put it this way. If you are a Facebook user, chances are you have all your friends (real or not) on Facebook. I have a history on Facebook. I have photos on Facebook. The more they grow into other content-based markets like Games, Movies, Songs and social commerce, the harder it will be to move away. MySpace was just a failed platform from the start – anyone will agree that it failed from a UX standpoint as well as a business standpoint. They never really focused on the social aspect of the social network. They grew too quickly into other areas without carefully considering how their social network would integrate with their horizontal offerings (music or whatever else they are up to). And the problem was that they invested in building those business units, taking their attention away from social networking. Big mistake. Facebook realized early on that to transform the social network, they had to give the power to developers who would utilize the social network. This led to a plethora of applications and services sold directly on Facebook. Long term, this means that Facebook becomes an attractive platform for social commerce, social gaming, and maybe social music. I have yet to see a company truly utilize the Facebook platform to build an effective social music site. Turntable is kinda there. But, I don’t think it stops with

Successful internet companies have kept a singular vision and have consistently improved their service – Netflix is primarily a movie recommendations platform and LinkedIn is primarily a business social network that monazites by offering services for recruiters.

Recursion and Algorithm design

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