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a16z Podcast | Not all Network Effects Are Created Equal

a16z2019-01-02
403 views|5 years ago
💫 Short Summary

The video discusses the evolution and impact of network effects, emphasizing their role in technology and social platforms like Facebook. It explores the importance of connectivity, personal utility, and bandwagon effects in driving growth and success. The segment also delves into the evolution of emojis, their cultural significance, and the challenges of representation and standardization. Additionally, it touches on the role of emojis in communication, sentiment analysis, and self-expression, highlighting the demand for diverse and personalized emoji options. The video concludes with a discussion on the upcoming emoji con event in San Francisco, focusing on emoji culture and representation.

✨ Highlights
📊 Transcript
The history and evolution of network effects, starting with AT&T's recognition in 1907.
00:50
Metcalfe's Law and its application in hardware like Ethernet cards, leading to cost reduction and increased device value.
Metcalfe's Law explains the exponential increase in network value as more users join.
Network effects are described as enhancing the value proposition of technologies like Facebook.
The power of networks grows as more users are added, highlighting the significance of network effects.
Network effects exponentially increase the value of a network, making companies with network effects dominant players in their industry.
03:27
Microsoft's operating system is cited as an example of a company benefiting from network effects.
In the digital world, network effects are essential for creating a competitive advantage.
Other defensive strategies like brand, scale, and embedding are valuable, but network effects are considered the most powerful in the digital landscape.
Network effects are particularly crucial in the transition from web to mobile platforms.
Evolution of technology from pre-2000 to post-2000 era, focusing on Facebook as a key social platform.
05:08
Transition to mobile emphasized accessibility of messaging and photo sharing apps for communication and network building.
Technology's natural inclination towards connectivity for creating value through network effects.
Various types of network effects, including direct network effects seen in Facebook, showcasing the importance of connections in deriving value from networks.
Evolution of network effects and types identified.
08:05
Importance of personal utility and money in driving user engagement.
Platforms like Facebook Messenger and WhatsApp providing useful services beyond social connections.
Impact of personal connections on deep platform adoption and longevity of messaging services.
Emphasis on the network effect business model and the role of personal connections.
Importance of Network Effects in Marketplaces.
10:41
Airbnb faced challenges in growth initially due to the requirement of balancing supply and demand for liquidity.
Two-sided network effects, such as Microsoft's platform, involve attracting both developers and users.
Different types of network effects require specific growth strategies for companies to succeed.
The role of bandwagon effects in network effects and product adoption.
14:24
Bandwagon effects influence popular choices and product adoption, as seen with Slack and HipChat.
Early social influence is crucial in driving viral growth through bandwagon effects.
Key influencers and promoters play a significant role in shaping the success of products, such as in Instagram's launch.
Understanding bandwagon effects is important for decision-making in feature development and resource allocation, emphasizing the impact of social dynamics on product adoption and growth.
Importance of network effects in the success of companies like Facebook compared to MySpace.
16:44
Product-market fit is crucial for building network effects, with MySpace's allowing connections with strangers hindering user engagement.
Facebook's focus on repeat usage and strong retention contributed to its success.
Difficulty in identifying the tipping point for network effects and measuring value for users highlighted in competitive markets with multiple players growing rapidly.
Importance of real names and utility in social networking platforms.
18:16
Facebook's emphasis on real names and utility resulted in a stronger network effect compared to Myspace's focus on entertainment.
WhatsApp successfully targeted international communities by offering a simple, free messaging service as an alternative to expensive SMS.
WhatsApp's partnerships with carriers further contributed to its growth and popularity among users.
Evolution and impact of emoji in modern communication.
21:56
Emoji have evolved from their creation to play a significant role in visual communication.
Emoji present challenges in politics, taxonomy, and translation, showcasing their importance in modern communication.
Fred Benenson, from Kickstarter, provides insights into the complexities and nuances of emoji usage and interpretation.
Jenny Lee's experience in leading the effort to get the dumpling emoji.
23:10
She initially found emojis bizarre but started using them in quirky ways to express herself.
The fun and challenges of emoji communication are discussed, including a funny exchange between friends using only emojis.
The absence of a dumpling emoji led to a realization of the universality of certain foods.
Emojis are regulated by the Unicode consortium.
Membership of the Unicode Consortium includes 12 full voting members, primarily U.S. tech companies like Oracle and Google.
25:10
The consortium evaluates emoji proposals during quarterly meetings to ensure quality and uniqueness.
Criteria for new emojis include unique meanings, ambiguity, and restrictions on celebrities, deities, and logos.
The Easter Island head emoji faced controversy for cultural insensitivity and misuse in conversations.
Evolution of emojis and differences between Apple and Android emojis.
28:01
Tokyo statue inspired the creation of emojis, leading to variations in appearance across platforms.
Cultural influences play a role in the design of emojis, with different vendors implementing them in their own way.
Standardization of emojis is discussed, along with the ease of misinterpretation of certain emojis like chopsticks.
Emojis: Ambiguity and Meaning
31:38
Emojis have multiple interpretations and provide a unique form of expression in a text-centric society.
They offer a break from constant word usage in communication and are popular due to the absence of traditional human elements in the digital world.
Emojis act as a substitute for nonverbal cues like facial expressions, aiding in conveying emotions and reactions in text-based interactions.
Evolution and Importance of Emojis in Communication.
33:45
Emojis offer a wider range of emotions and meanings compared to traditional text, improving communication.
Emojis have evolved from emoticons to a standardized Unicode system, allowing them to be easily inserted into emails and texts.
Emojis are considered part of a global graphical representation system, with each having a specific code point for rendering on devices.
Understanding the technical aspects of emoji encoding is essential for effective communication on text-based platforms.
Overview of how operating systems handle rendering emojis and the introduction of unique emoji sets by different companies.
35:43
Facebook and Twitter have released their own emoji sets, while Microsoft has updated theirs to more traditional designs.
Emphasis on the importance of skin tone neutrality in emojis, with Microsoft choosing gray emojis.
Companies have the ability to add emojis to their sets without going through Unicode, illustrated by the example of the gay family emoji as a compound emoji of four characters.
Emojis lack diversity beyond traditional roles like princess or dancer, sparking debate for more representation, especially in professional female emojis.
39:49
Political decisions influence emoji design, evident in controversies like the rifle emoji and country flag pairings determined by handset manufacturers.
Emojis have a limited palette, making it challenging to fully represent diverse aspects of humanity like relationships, sexual orientation, and skin color.
The challenge lies in encapsulating the growing complexity of human diversity within a finite set of symbols.
Evolution of Emoji Skin Tones
40:34
Emoji skin tones based on the Fitzpatrick system have empowered individuals of color.
Limitations exist in addressing nuanced aspects of cultural and racial identity like facial features and hairstyles.
The conversation reflects on the impact of limited emoji customization in capturing diverse representations.
Unicode is making ongoing efforts to expand emoji options annually.
Importance of standardization in communication.
44:12
Stickers are more expressive than emoji, but there is a need for universal images.
Standardization ensures consistent communication across devices and operating systems.
Accessibility for visually impaired individuals is raised, with emoji being more accessible due to their names.
Standardization is crucial for effective and inclusive communication.
Evolution of emojis and impact on sentiment analysis.
46:15
Popular emojis have changed over time, and the ownership of proprietary emojis by companies has implications.
Emojis and Facebook reactions allow for more nuanced emotional readings compared to traditional sentiment analysis methods.
Use of emojis on social media platforms like Facebook provides labeled data for sentiment analysis, aiding in the development of machine-readable emotional sentiment understanding.
Introduction of the 'mood graph' concept to capture and analyze changing emotional states.
Demand for personalized emoji reflects desire for personal representation in digital communication.
48:37
Bitmoji allows users to create highly customizable emoji for self-expression.
Snapchat's acquisition of Bitmoji demonstrates a trend towards self-expression through facial expressions and filters.
Digital representations must have a somewhat cartoonish quality to be believable, tying into the concept of the uncanny valley.
Empowerment gained from expressing oneself through filters and digital avatars is highlighted in a popular Facebook live video featuring a woman trying on a Chewbacca mask.
The speaker explores the idea of using emoji as a communication tool and the challenges of translating a public domain book into emoji symbols.
51:07
They considered writing a book entirely in emoji, reflecting on the difficulty of portraying historical figures in a modern context, like in the musical Hamilton.
Initially, they thought about translating the Bible into emoji but decided it was too obvious of a choice.
The speaker highlights the complexity of such a task and the creative exploration involved in using emoji for communication.
Experimenting with translating Moby Dick into emojis using Mechanical Turk.
53:47
Created own emoji picker and used raw emoji images through reverse engineering.
Turk workers chose emojis like telephone, face, sailboat, and whale for the first sentence.
Results were humorous, showcasing the creativity of Mechanical Turk workers.
Demonstrated the potential for unconventional technology uses.
Journey of creating and publishing an emoji deck through Kickstarter.
56:09
Speaker discusses different versions, costs, and success of campaign.
Library of Congress acquires emoji deck for its cultural significance.
Speaker receives certificate from Library of Congress listing emoji deck as a translation of Moby Dick.
Speaker shares journey from creation to recognition by prestigious institution.
Emoji Con set to take place in November in San Francisco.
58:14
Activities include panels, talks, film festival, hackathon, and art show.
Event aims to bring people together around cultural significance of emojis.
Policy decisions around emojis will be highlighted.
Attendees will include members of Unicode emoji subcommittee, generating enthusiasm among activists and enthusiasts.