Social Graph Mania -- and the Winner is...

The annual mega-Web event dubbed Web2.0 Summit is almost a week behind us. Amid all the gushing over Facebook's rise, the impending ad network they're building, the potential investors courting them, and how MySpace will finally open up and spruce up their butt-ugly interface, there were some interesting nuggets to be learned (for the German-speakers, I wrote about it at length for the Technology Review Deutschland):

• Six of the world's top ten web sites, based on Alexa traffic rankings, were not on that list in 2005. The likes of MySpace and YouTube have kicked the first-generation search and shopping sites off the top spot. And that's just the beginning, according to Morgan Stanley's Mary Meeker.
• MySpace cannot grow anymore without building a large and hip presence in San Francisco. 200 people, to be precise, will be working in SoMa. Being based in Lala-land doesn't cut it in terms of real-world social networking.
• Facebook will grow from 300 people to around 700 by the end of next year, believes founder and CEO Mark Zuckerberg.They've run it since day one at break-even and intend to keep it that way.
• Facebook's long-awaited ad network is not ready to be talked about for about another three months, he said on stage.
• Amazon Web Services has grown explosively and now hosts more than 10,000,000 objects, or files, on their S3 servers, and they've boosted their processing power in EC2 to support "ravenous applications" like search. No wonder the online store spent $181 million in the last quarter on technology and content development. money that goes into everything from servers to power its download service to getting movies and ebooks ready for their Kindle service (supposedly about to be unveiled this month...)
• Google is salivating at the health records market -- for remote access, storage, sharing, collaboration. Just the two billion X-rays created in the roughly 2,000 North American hospitals each year amount to 200 petabytes of data, according to Marissa Mayer. That's an exciting field where Microsoft has just planted a flag with its Healthvault.

Here's a selection of key videos from the event:

With hindsight, what was noticeably absent from the Facebook feeding frenzy was Yahoo, a company that started out as a great innovation combining new technology with human-driven search and discovery, the perfect ingredients for a social graph stew. These guys are sitting on a mountain of social graph data -- if they only found a way to tap it, or mine it in a benign way that hands the power of the connections over to the user.

It's a huge market where an interoperable solution (let's call it the "open graph") must come about sooner or later. Just consider what the Wall Street Journal had to say about the treasure trove that's good old e-mail, mostly provided by the likes of Google, Microsoft and Yahoo:

"In August, there were 542.9 million users of email that is accessed primarily via Web browsers. That compared with 483.7 million social-networking users world-wide, according to comScore Inc. Including non-Web-based email such as accounts that businesses provide to their workers, there will be 1.4 billion email accounts in active use world-wide at the end of this year, estimates Radicati Group Inc., a Palo Alto, Calif., research firm... Yahoo executives describe the company's 250 million email users globally as the "world's largest dormant social network."

Microsoft went about tapping the geyser the old-fashioned way: buying a late ticket into yet another online phenomenon it slept through. After much speculation, it announced a $250 million investment in Facebook, coming on the heels of their advertising deal.

What's next after now 6,000+ apps on Facebook for throwing sheep and sending drinks? Some serious stuff built on top of our individual social graphs.

How about e-mail as a true social networking application? Companies such as Xobni and Boxbe are working around the edges of this messy space, but they are tying their success to Outlook add-ons and Webmail plug-ins. Perhaps they should follow the example of iLike, which took off after moving its music app from the Web to Facebook -- go where the users are and help solve their pain points!

Comments

[matt brezina]

Hi Stefan,

Thanks for the great review of the social graph discussion that has been taking place recently. We're happy that Xobni is a part of the discussion.

I do have to contend, in the case of Xobni, that we are going directly to the source of our users. I think Outlook is our Facebook. The users and the data are both there.

-Matt
Co-founder, Xobni