Friday, 2 November 2007


Since the launch of the facebook platform, when developers were given freedom to develop applications and even revenue streams on facebook, there has been an explosion in the number of them. Developers such as RockYou and Slide have narrowed their focus into this category, and venture capitalists such as Bay Partners, have launched Appfactory - a fast-track program supporting entrepreneurs dedicated to developing applications for facebook. It's a growing economy.

According to facebook they now have more than 51 million active users, and are gaining an average of 200,000 new registrations per day since Jan. 2007. All good news.

On the apps side, they say that over 7,000 applications have been built on the Facebook Platform. There are 100 new applications added per day, and more than 80% of Facebook members have used at least one application built on Facebook Platform. This makes creating a successful new app a tough job.

Interestingly, if you place the active user numbers in a chart you see it's a long tail chart. The app market has network effects: the more people use the app, the more want to join in. People want to use what their friends use, which is different from having what your friends have. Active apps are like dominoes cascading through the social graph, meaning there are a few really big winners like Top Friends and Fun Wall, and thousands of very small players in the tail.

This is a tale of two economies: a have-app economy; that sits below a use-app economy. There are firms already appearing to help you move from have-app to use-app - such as socialmedia. And there is a sprouting, but not yet thriving advertiser model in the use-app economy. It will be interesting to see how these change over time, and see how advertisers start to use them (or perhaps how they start to use advertisers).