Tuesday, March 19, 2002

Reed's Law: Beyond Metcalfe's Law to the Power of Community Building

This is a "classic" article about value creation in networks. The value of broadcasting networks grows linear with network size, transaction network value grows with the square of the network size (this is Metcalfe's Law) and group forming network (GFN) value grows exponentially with network size. The notion of "potential connectivity" is introduced. I think this is a brilliant article.