Banking on Status

When balance matters in a mature two-sided business, the pricing problem is much more complex than in a single-sided business. Marginal cost and price responsiveness on both sides matter for both prices, and so does the pattern of indirect network effects. In general, if side A cares more about side B than B cares about A, then, all else equal, A w

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If membership isn’t scarce, the membership loses its signal message. The same applies to physical products: Apple will never offer a cheap iPhone to compete with low-end Android devices – it would destroy the company’s signal message that the iPhone is a luxury product.

Social network tooling is missing critical element, money built for social.