Category Archives: value of networks

Theory behind the Social Media explosion

I mentioned in the last post some of the history behind why Social Media is in an absolute boom at present. Mostly this is to do with human interaction and the our social nature which leads us to find ways to communicate and collaborate over long distances. There has also been a business cultural shift towards embracing these social tools to open up a dialog with customers which is perhaps due to the changing generational mix in the workforce as Andreas Kaplin & Michael Haenlein point out:

“The growth is not limited to teenagers, either; members of Generation X, now 35-44 years old, increasingly populate the ranks of joiners, spectators and critics.” – Kapaln & Haenlein, Users of the world unite! The challenges and opportunities of Social Media.

I suspect this push will go even further as more and more Generation Y enter the workforce and expect these tools and computing experiences.

However, I would like to explore a more empirical approach and theory as to why there has been this explosion of Social Media adoption. I would like to bring up an interesting theory that I read about in an excellent book by Juliette Powell called “33 Million People in the Room”.

I was also lucky enough to meet Juliette at a creative media conference and workshop a few years ago see her video from X:Media:Lab.

In her book, Juliette brings up Reed’s Law which essentially mathematically models the exponential growth in value of a network based on the number of participants in the network. This goes a long way to explaining the huge growth Social Networking sites such as Facebook have had recently.

No doubt you joined Facebook because your friends or family were on Facebook which made it valuable to you; just as your friends and family then also joined because you are on Facebook which had value to them and so on…Ad infinitum.

It is suggested in Reed’s Law that every new addition to the network doubles its value and taking the example from the Juliette’s book, it is easy to see this in action.

“…you have a network of 25 individuals. According to Reed’s Law, the amount of possible connections and subgroups within your group of 25 individuals is an astonishing 33 million” – Juliette Powell, 33 Million People in the Room.

And if we apply the maths…

  • Lets say N is the number of people in the network… in this case N = 25 people in the network.
  • The number of possible sub-groups available is modelled as 2^N (2 to the power of the number of people in the network).
  • So, 2^25 =  33,554,432 possible connections and sub-groupings within that network!
  • The growth in value is exponential, as mentioned each new member doubles the value of the network for example: 2^N+1 in this case is 2^26 = 67,108,864 connections and sub-groupings!!
Now apply that theory and logic to the vast number of users on Facebook, the mind boggles!
Looking at the infographic below by Ben Foster (@benphoster on twitter) it does indeed show a very exponential style growth of users on Facebook, perhaps there is some truth in this model of growth?


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