The Social Networking Faceoff
Written by Alex Iskold and edited by Richard MacManus.
With all this buzz around the potential Yahoo! acqusition of Facebook for $1Billion, we think it's time to do the social networking faceoff.
Arguably of all services in the new social era, the social network sites hold most promise. The reason for this is that these community-driven sites have the ability to leverage their user base across other social web verticals. For example Facebook is also a photosharing service, MySpace is also a music sharing service and LinkedIn is a vertical search engine for Jobs. So the stakes in the social networking game are much higher. Naturally then, the social networking space has received major attention from premier venture capitalists. Please refer to our Web VC Chart post, where we we worked out the portfolios and sizes of the investments in this space.
Another natural trend that we are seeing in the space is demographic segmentation. Most social networks target a segment of the population - either explicitly as part of their business plan, or as a byproduct of the rules of network formation. LinkedIn is focused on Business Professionals, Facebook is focused on college students (although it has ambitions to go into the business space), while MySpace targets teenagers, college students, music and hip culture.
In addition to those three, Bebo is making some major waves and has surpassed MySpace in UK and New Zealand. Bebo's focus is quite similar to MySpace, although the pages are not as chaotic. And now there is also an interesting twist in the whole social networking space - the trailing and tired Friendster recently was awarded a patent on some key ideas used in all social networking sites. Knowing that Kleiner Perkins is behind the company, we can expect some moving and shaking soon.
The Social Network Faceoff Chart
Bebo |
 Friendster |
MySpace |
TagWorld |
Orkut |
|||
|---|---|---|---|---|---|---|---|
| Estimated Active Users |
25M+ 1.9M (*) |
7M (*) | 5.8M (*) | 1.5 (*) | 70M+ |
1M 0.9M (*) |
49M (*) |
| Alexa rank | 268 | 71 | 40 | 219 | 6 | 2,373 | 16 |
| Alexa daily views (Per million) |
475 | 1,800 | 1,500 | 380 | 18,000 | 22 | 12,500 |
| Google blogsearch links |
3,700 | 7,000 | 18,600 | 5,900 | 401,000 | 3,500 | 32,000 |
| Focus | Teenagers/ college students |
College students | Anyone | Business | Teenagers/ college students |
Teenagers/ college students |
Anyone |
| Classifieds | X | X | X | X | X | ||
| Events | X | X | |||||
| Groups | X | X | X | X | X | ||
| Messages | X | X | X | X | X | X | X |
| Music | X | X | X | X | |||
| Photos | X | X | X | X | X | X | |
| Services | X | ||||||
| Video | X | X | X | X | |||
| Clean Design |
X | X | X | ||||
| API | X | ||||||
| Widgets | X | X |
(*) The active user estimate is based on the assumption that MySpace has 70M users. We then used Alexa daily pageviews number to estimate the number of active users for other social networking sites. Note that the number for TagWorld agrees with the number given by TechCrunch in March of 2006. This is not surprising since it appears that the traffic for TagWorld had been on decline. On the other hand there is a big descrepancy in Bebo's value. This can be attributed to either inaccuracy of Alexa data outside of US or inactivity of Bebo users. Note that TechCrunch gave the number of registered users, while we estimate the active users. The truth is probably somewhere in between.
Traffic Dynamics
We can gain additional insights by looking at the traffic dynamics over the past year. Alexaholic only allows 5 sites to be compared at once, so we had to make 2 charts. Note that LinkedIn appears in both to help correlate them.
Orkut is rising?
From the charts we clearly see that Orkut is gaining, but why? The feature set and the user interface are not impressive. The answer has to be its affiliation with Google, but we found another interesting chart, within Orkut itself:
But perhaps it is not just that Brazilian users dominate, but also the attitude and confidence of Orkut. Here is a paragraph from Orkut's about page:
Conclusion
MySpace is an undisputed leader on all counts, but Orkut is on the rise and it's moving very rapidly. Facebook is in excellent shape - hence the interest from Yahoo!. It'll be interesting to watch if LinkedIn expands its user base and offering. At this point, TagWorld looks shaky, while Bebo does not look as strong as it has been portrayed recently. And the old timer Friendster is not out of the game yet - it's doing just fine. All and all it looks like the battle for the gold (MySpace, Orkut) and for the bronze (the others) is going to heat up.
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The orkut can't possibly be right. 49m active users? no way. must be some cross-pollination with google in the alexa stats, or something. Alexa is a poor comparison maker.
The Orkut data is interesting - according to Alexa it has drastically improved from July-Sept, up from 25th biggest site to currently being the 11th! Ideally I'd like to get some other data to correlate this, because you're right sometimes Alexa needs to be taken with a grain of salt. Am currently checking to see what other data is out there re Orkut... if anyone has pointers, please let us know in the comments.
What about cyworld? They have substantially more users than many on this list?
These series of article are very cool !!
Richard, I remember some time ago.. there was a rise in the number of fake and clone profiles within this property. (XSS/JS hacks). This certainly needs to be factored in !!
I think page views is a poor proxy for value delivered or business success. LinkedIn has been profitable for the past six months, and revenues are growing very quickly. I'm not sure who else can say that. So, while we have lots of ideas for making LinkedIn more valuable to our members, we feel there is not a need to "pull something out of the hat." Orkut, MySpace, Facebook, Friedster or Bebo are not of concern to us. I'm not sure if any other player mentioned here (except perhaps Facebook among college students) has the same type of leadership position in their space.
Alex,
Great research and I respect your view. However, I think your thoughts are bit off on how to correlate value to the user, at least with regard to LinkedIn. LinkedIn serves the business professional extremely well. I use it much more effectively as a networking and reference tool and use it in a much different manner than one can use the other networking sites you outline in the post.
Think LinkedIn is here to stay. Will it have stratopheric revenues due to "eyeball" test, probably not. But for overall long-term value it provides users, it will be interesting to see who competes... Just my thoughts...
Konstantin / Lou,
I myself is a huge fan of LinkedIn and an avid user. I think it is unique and very well done. My point in this post is to compare the usage and the size, but we will rephrase the 'hat' sentence as it does send a bit harsh message.
Alex
Removed the contentious 'hat sentence' from the conclusion - that was actually my re-phrasing of what I thought Alex wrote. So I probably got the interpretation wrong. Apologies for any offence caused.
Richard,
No worries, all are entitled to opinions which is what makes the net and blogging a great thing. Keep on the great work on read/write, always a valuable read.
Perhaps this thread will have Konstantin to hand out some free InMail credits. ;)
We are still looking into more details on Orkut data.
The chart below indicates that steep growth is quite recent, it started in July 2006:
http://traffic.alexa.com/graph?w=379&h=216&r=6m&z=&y=r&u=orkut.com/&u=
If you have more insights on this, please share them.
I tried other techniques for measuring users. For example, I searched for various terms on Orkut, Bebo and MySpace to get the frequency of occurence. Unfortunately this technique does not work as nicely with these sites as it works with bookmarks. Often times we can't tell the total number of results.
Alex
The socialnetworking landscape in other parts of the world including Latin America is still a frontier. Brazil, Argentina, Chile... if you look into specific sectors of socialnetworks (photosharing, blogs, etc.) in these countries, you get a very different sense of dynamics of viral marketing. The really interesting part here is that no one really seem to truly understand what makes certain networks more viral than the other when virtually none of the players are actively engaged in marketing. One more note on Brazil... if you dig a little deeper, there's also an social-ecosystem at play. Brazilian Orkut users for instance heavily contributed to a certain photosharing service's growth when they tried to workaround the limitation Orkut put on how many photos members can post per day.
Soxiam,
This touches upon something dear to my heart from my previous life. The network dynamics is a really interesting, and fairly well studied area. In fact, there was recent (2000) surge when Duncan Watts published his paper on Small World networks:
http://tam.cornell.edu/SS_nature_smallworld.pdf#search=%22small%20worlds%20networks%22
Another outstanding resource is Albert Barabasi's page:
http://www.nd.edu/~networks/
The conclusion of the researches is that networks, like all complex systems, grow in phases, where clusters of connectivity naturally emerge. The topology of small worlds networks is such that they are generally sparse, but locally connected. Yet there are links between clusters, allowing people to get to each other within 'Six-degrees'.
You can actually see this even on your LinkedIn page when you login, because they are showing you how many people are within first few degrees of separation from you. It would be fantastic to be able to get the data from companies profiled in this post and to analyze the growth pattern!
Alex
List of social networking websites
http://en.wikipedia.org/wiki/List_of_social_networking_websites
Dimitar,
Are you pointing to something specific on wikipedia or just generic FYI sort of thing?
Alex
Some of the sites listed have sociability as their primary feature - they are created as a social space. But there are also other services, like del.icio.us and flickr.com, that are created to deliver a certain functional benefit - like managing bookmarks or pictures online - as their primary purpose. That's what draws people to them in the first place. Then, on top of this, they create a social layer that compounds the effect of people's content by several multiples and fuels a community that can take advantage of this unique resource.
Alex,
Please provide some insight (if you can) as to where Hi5 ranks amongst these social networks?
Edmund,
hi5 is a contender as well. It has Alexa rank of 48 now and gets 1,500 page views, which places it at roughly the same user base as Friendster - 5.8M.
Alex
Ted,
Orkut is by far the most popular site in Brasil. I live here now. Everyone has an account and they use it multiple times per day. If you meet anyone in between the ages of 12 an 40, there is a good chance they have an Orkut account and use it regularly. It has replaced email for many users as well. So I think those numbers are accurate.
Thanks Eric, this is great to know!
Alex
Great article!
I tried doing a trackback to your site, but only received errors :-(
You can see it over here.
http://insideorkut.blogspot.com/2006/09/is-orkut-catching-up-to-myspace.html
Anyways, what I would like to know is if (or rather when) Facebook opens its doors will it dethrone Orkut from the number two position (with a Yahoo backing of course).
Also, do you think Orkut has a good chance of dethroning MySpace?
Darnell,
In terms of ability of Facebook to catch up with my space, there are factors in addition to just opening doors. Facebook does not have music or videos which have been critical factors in MySpace adoption - these need to be in place.
There is also something to be said about free form layout of MySpace vs. beautiful and symmetric design of the Facebook. I prefer the Facebook approach, but looks like most people like the MySpace chaos.
In terms of Orkut out pacing MySpace, I think that this is also a long shot. First, I found Orkut content and user interface confusing. There are many inconsistencies and things to be cleaned up. Even if clean up happens, the catch up might be difficult, unless Google brings in its user base. It is quite possible, though, that Orkut will remain dominant in Brazil and might dominate in countries other than US.
Alex
Here 's a post on 'Why Brazil Loves Orkut!'
Of all the social networks listed above, I'm a member of just 'LinkedIn', it serves as an evergreen address book to me.
Apparently, it's not just Brazilians who like Orkut. Al-Qaeda likes it too.
I read this in the Fortune article on the plane yesterday:
Marissa Meyer, Google VP, says with a straight face that another country Orkut is popular in is Iran.
Alex
I am a recent new member on Orkut. It says that I am connected to 28.5 million people through the one friend who invited me. So, I think this must be the current number of Orkut users.
The #1 and #3 countries in Orkut are completely different demographics; in that sense orkut is ruling in two different worlds - South America and South Asia. Orkut's presence is bound to grow sustainably partly because of its status as the top social networking website in India, a tag it took from Hi5 during the period of acquisition by Google.
India is a rapidly growing Internet market but has more long-term potential than immediate. However, being India's top social networking website would mean a ripple effect growth amongst the distributed south Asian community; that has members across the globe.
I do feel, however, that they really do need to add to their toolbox before the south Asian crowd discovers the other sites that are high on features. It has also surprised my why none of the other top sites are targeting India as a market.
Sameer,
This is very insightful - thanks!
I think the answer to your question is that to target different markets means to target different cultures and this is not so easy.
Alex
"From the charts we clearly see that Orkut is gaining, but why? The feature set and the user interface are not impressive. The answer has to be its affiliation with Google"
Umm.. NO! Surely if MySpace has taught people anything it is that the success of a Social Networkign site has little to do with who created it or its user interface and everything to do with the people using it. Orkut is popular in Brazil because Brazilians use it, which creates a self-reinforcing feedback loop.
The real question is how to seed your social network to make it grow like that. As far as I know that's an unanswered (billion dollar) question.
plz do mail me that how can i register myself on orkut website. could u plz invite me to join orkut community website.
thx a ton