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Social Networking as Disruptive Innovation?

November 27th, 2003 · No Comments

Silicon Valley writes: “The gold mine, as VCs see it, rests in using the Internet to give a personalized, user-friendly twist to mainstream industries like dating services, job listings and classified advertising.”

Adds News.com:

Publishers Knight Ridder and The Washington Post Co. are banking on social networking to be the future of online classifieds, having invested $6.3 million in a “six degrees” Web venture. The two publishers, along with venture capitalist Mayfield, invested in Tribe Networks, the owner of an online community that links friends and friends of friends, and then promotes them as the ideal network through which to buy things, find a job or even get a restaurant recommendation.

Called Tribe.net, the four-month-old site plays on the theory of “six degrees of separation,” in which strangers are inevitably linked to each other by at most six people. The goal is to join like-minded people for socializing, dating, networking or building a local marketplace.

the publishers’ interest is significant, because it signals a potentially new direction for online classifieds, a billion-dollar market newspapers risk losing to niche sites like job clearinghouse Monster or online communities such as Craigslist. Knight Ridder and The Washington Post Co., parent of newspaper The Washington Post, say they want to incorporate social networking as a means of building an indispensable local marketplace for information or goods, and ultimately to inspire loyalty to their publications.

Social networking seems to follow the path of a disruptive innovation as it starts to disrupt mainstream industries. Still too early to tell, but with VC money flowing in, the task will get easier.

Tags: Software

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