Analysis on social network adoption according to the change of network topology: the impact of "Open API" to adoption of Facebook

  • Authors:
  • Gwangjae Jung;Byungtae Lee

  • Affiliations:
  • Korea Advanced Institute of Science and Technology, Seoul, Korea;Korea Advanced Institute of Science and Technology, Seoul, Korea

  • Venue:
  • Proceedings of the 12th International Conference on Electronic Commerce: Roadmap for the Future of Electronic Business
  • Year:
  • 2010

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Abstract

A social network service is one of the most prospering social media in the Web 2.0 era. In SNSs, a massive number of people make online friends and share their interests. In May 2007, Facebook made an announcement of "Open API" policy, which allows a third-party to create applications in Facebook. After "Open API," users of Facebook can utilize various interactions other than just messaging. This led to radical increase in user growth of Facebook and threatened Myspace, which was the top SNS at that time. This innovative move gathered an interest of how "Open API" affects interactions in social networks. The main objective of our research is to analyze the relationship between the growth of social network adoption and network topology. For this issue, our study conducts both analytical and empirical models. First of all, we adopt the concept of Metcalfe's and Reed's law to model the growth pattern of social network under duopoly competition of two SNSs. Then we apply the growth functions to the empirical analysis. We collect web traffic data of Facebook and Myspace from Alexa and test the structural change after the adoption of "Open API" policy. The result of the analytical model shows that social network adoption follows a quadratic growth under Metcalfe's law and an exponential growth under Reed's law. The result also shows the conditions for a SNS to take all new adopters in the market. If the SNS follows Reed's law, it can absorb all new adopters even if that particular SNS is a newcomer in the market. The empirical result confirms that there exists a significant difference in the growth pattern between, before and after "Open API." This implies that "Open API" transformed Facebook one-to-one communication network into a group forming network. Eventually, this transition increases potential connectivity in social network and leads to exponential growth of social network adoption.