Network effects and valuing social network services.

ABSTRACTModels including network effects are often invoked to justify the high value of social network services like Facebook. Yet as time passes and user numbers grow, inevitably so does reach across social circles, creating "online tension" or, as we term it, mismatch of social display. This leads to reduced participation. Social network services respond with efforts to segment networks through efforts like separate 'friend lists'. We provide a conceptual framework and a visualization to incorporate these insights into models of network effects and social network value.