MGCR 331 Chapter Notes - Chapter 8: Open-Source Software, Social Graph, Dark Web

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Published on 20 Apr 2013
School
McGill University
Department
Management Core
Course
MGCR 331
Chapter 8 Facebook: Building a Business from the Social Graph
- short selling: an attempt to profit from a falling stock price. Short sellers sell
shares they don’t own with an obligation of later repayment. They do so in
the hope that the price of the sold shares will fall. They then repay share debt
with shares purchased at a lower price and pocket the difference between
initial share price and repayment price.
- Dark web: parts of the internet not accessible by Google or other search
engines
- The worry is that such a large part of the web that is controlled by one firm
that is closed off will curtail innovation, competition. Etc.
- Cloud: the big group of connected servers that power the site
- Open source software powers much of the site --- runs on the Linux OS and
Apache web server software.
- Other code components written in a variety of languages, such as C)) and
Java.
o Access between the components managed by a code layer the firm
calls Thrift.
o Haystack is FB’s own media serving solution for photos. In-house so
saves FB money on content delivery networks.
- Social graph: the global mapping of users and organizations, and how they
are connected.
o FB’s ability to collect, express, and leverage the connections between
the site’s users.
o Everything is connected other users, photos you are tagged in, etc.
- Initially, b/c of the legitimacy of registering for FB (putting in a email to
verify, the two-way friendship..) people were very trusting of the network.
Today, people post lots of personal info that they wouldn’t share outside
their friend group.
- Strong network effect: when the value of a product or service increases as
its number of users expands.
- Powerful switching costs as well --- a move to another service means
recreating your entire social graph.
- In 2007, FB opened itself up to application developers published a set of
application programming interfaces that specified how programs could be
written to run within and interact with Facebook.
o Developers could charge, offer for free, run ads FB let developers
keep what they made
o Crazy fast 1 year in, 400 000 developers and entrepreneurs, 24 000
apps, 140 apps added each day, and 95% of FB members had installed
at least one FB application.
- Give service for free makes bulk of revenue through advertisements
- Online advertising model --- still have not found the best way to utilize it
- Two challenges
o 1. Content adjacency
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Document Summary

Chapter 8 facebook: building a business from the social graph. Short selling: an attempt to profit from a falling stock price. Short sellers sell shares they don"t own with an obligation of later repayment. They do so in the hope that the price of the sold shares will fall. They then repay share debt with shares purchased at a lower price and pocket the difference between initial share price and repayment price. Dark web: parts of the internet not accessible by google or other search engines. The worry is that such a large part of the web that is controlled by one firm that is closed off will curtail innovation, competition. Cloud: the big group of connected servers that power the site. Open source software powers much of the site --- runs on the linux os and. Other code components written in a variety of languages, such as c)) and.

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