Can strong network effects lead to irrational or undesirable outcomes?

Apr 10, 2025 ... This post should clarify how we at Blitzscaling Ventures see network effects, and why they are so important to our investment decisions. Network ... Sep 13, 2018 ... Direct effects occur when a good's value increases as the number of users goes up. Telephones exhibit direct network effects, as did fax ... Dec 13, 2018 ... The Dynamics of Network Effects · network effects, where the network becomes more valuable to users as more people use it. · the theory · improve ... Oct 1, 2022 ... Data can have standalone value as a digital product or service but to evolve into a multisided platform business it needs additional qualities. Network effects refer to the incremental benefits gained from new users joining the platform, which results in the product becoming more valuable for all users. Jan 4, 2016 ... In the furiously competitive world of tech startups, where good entrepreneurs tend to think of comparable ideas around the same time and ... Jun 21, 2015 ... A product displays positive network effects when more usage of the product by any user increases the product's value for other users (and sometimes all users). The most important underlying economic concept here is that of network effects -- the fact that higher usage of certain products makes them more valuable. While ... By creating a feedback loop that makes a product or service more valuable as more people use it, network effects can create a powerful competitive advantage for ... May 22, 2023 ... ... effect, which is when a product or service becomes more valuable as more people use it. Telephones are the classic example of a network effect.