If facebo o k is go ing to co ntinue to give away its

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Unformatted text preview: d the right mix o f mo nito ring, pro tectio n, and appro val while avo iding cries o f censo rship and draco nian co ntro l. P latf o rm o wners beware, develo pers can help yo u gro w quickly and can deliver go bs o f value, but misbehaving partners can create f inancial lo ss and brand damage and can so w mistrust. K E Y TAK E AWAYS Facebook’s platform allows the firm to further leverage the network effect. Developers creating applications create complementary benefits that have the potential to add value to Facebook beyond what the firm itself provides to its users. There is no revenue‐sharing mandate among platform partners—whatever an application makes can be kept by its developers (although Facebook does provide some services via revenue sharing, such as Facebook Credits). Most Facebook applications are focused on entertainment. The true, durable, long‐term value of Facebook’s platform remains to be seen. Despite this, top app developers have found Facebook to be extraordinarily lucrative. Z ynga is a multibillion‐dollar firm, while Playfish and Playdom were acquired for hundreds of millions of dollars each. Running a platform can be challenging. Copyright, security, appropriateness, free speech tensions, efforts that tarnish platform operator brands, privacy, and the potential for competition with partners, all can make platform management more complex than simply creating a set of standards and releasing this to the public. QU E S TI ONS AND E XE RC I S E S 1. Why did more developers prefer to write apps for Facebook than for MySpace? 2. What competitive asset does the application platform initiative help Facebook strengthen? For example, how do apps make Facebook stronger when compared to rivals? 3. What’s Scrabulous? Did the developers make money? What happened to the firm and why? 4. Have you used Facebook apps? Which are your favorites? What makes them successful? 5. Leverage your experience or conduct additional research—are there developers who you feel have abused the Facebook app network? Why? What is Faceboo...
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This document was uploaded on 01/31/2014.

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