added by sari and · updated 9mo ago
The Power of Defaults
- Becoming the default browser homepage became Google’s actual moat. There can only be one homepage (no multihoming) and users are typically too lazy to change it (friction = switching costs).
from The Power of Defaults by Julian Lehr
sari added 3y ago
- Thanks to this powerful data network effect, Google was able to move down the stack. Google wasn’t “just a website” anymore, it became an aggregator that commoditized all other websites and made them layers on top of Google’s.
from The Power of Defaults by Julian Lehr
sari added 3y ago
- This essay isn’t about network effects per se. It’s about the end state that they can enable: Defaults.
from The Power of Defaults by Julian Lehr
sari added 3y ago
- Unsurprisingly, in their attempts to become defaults, other companies have tried to create their own identity base layers. One of them is Facebook.
from The Power of Defaults by Julian Lehr
sari added 3y ago
- Today, Facebook is seen as the prime example for the power of network effects – and yet, one wonders where Facebook would be had it not acquired Instagram back in 2012. People also seem to forget about all the other social apps which Facebook has bought and subsequently shut down over the years. Why would a company that has supposedly “won the mark... See more
from The Power of Defaults by Julian Lehr
sari added 3y ago
- Decentralized protocols would make very interesting base layers and I’m particularly excited about web3 in the context of identity. Does crypto solve the problem of suboptimal defaults? Well, that’s a different question and I’m honestly not sure. Just because you have decentralized base layers doesn’t mean you won’t see centralization, aggregation ... See more
from The Power of Defaults by Julian Lehr
sari added 3y ago
- In contrast to Google and Apple, Facebook doesn’t own an operating system and, thus, doesn’t enjoy the defensibility of a pre-installed default. But because Facebook is the de-facto online identity layer for so many people, it is almost guaranteed to secure some of that limited pixel real estate on the user’s home screen.
from The Power of Defaults by Julian Lehr
sari added 3y ago
- Because of their marginal costs, atom-based businesses have a greater lock-in effect and thus defensibility.
from The Power of Defaults by Julian Lehr
sari added 3y ago
- The beautiful thing about defaults is that they beat almost any competing product – even if that competitor has strong network effects or is technically superior.
from The Power of Defaults by Julian Lehr
sari added 3y ago