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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
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.
- Winter '14