jump to navigation

Unleashing the European app economy May 9, 2013

Posted by David Card in Uncategorized.
Tags: , , , , , ,
add a comment

While the markets for apps that run on mobile and social platforms have exploded in the U.S., they’re just getting underway in Europe. GigaOM Research is teaming up with the Digital Enterprise Research Institute at NUI Galway and the European Commission to better understand the potential European opportunity, and to identify potential hurdles to growth that EC policies might address. We’re kicking off the project with a workshop in Brussels on June 14.

We profiled apps developers and their business models in this 2012 survey-driven report with the help of the Application Developers Alliance, and we’ll be doing similar scoping for the Eurapp project, as well forecasting spending and job creation, and using workshops and crowdsourcing challenges to help guide EC policy ideas. Eurapp is part of the Startup Europe initiative of the European Commission’s Digital Agenda, which aims to help tech entrepreneurs start, maintain and grow their businesses in Europe.

The Shape the Future workshop in June will have invited speakers from the apps industry, including Samsung, Tyba, and Betapond. The format will be a series of lightning talks featuring experts in the space, followed by Mapping Sessions to probe attendees’ collective thinking and examine some of the issues to be tackled in growing the app economy in Europe. After the workshop, we’ll crowdsource solutions to address bottlenecks and to suggest potential success strategies via two innovation challenges via the Innocentive platform.

Attendees at the event include: Peter Elger, CTO of Betapond; Kumardev Chatterjee, founder of the European Young Innovators Forum; Kevin Mobbs, Director of Innovation Programs EMEA at Innocentive; and Eurapp project lead John Breslin, who is also co-founder of boards.ie and the app company StreamGlider. I’ll be there as well.

The workshop will be held in BU33, Auderghem in Brussels on 14th June 2013. There are very limited places available for the workshop, but you can apply to attend at http://eurapp.eu/


A social gaming manifesto August 13, 2012

Posted by David Card in Uncategorized.
Tags: , , , , ,
add a comment

Zynga is in turmoil. Since its IPO, its stock has cratered, attracting public exposure of company morale problems that may be more than pockets of dissent. The company reorganized senior management, leading to the departure of its COO, veteran games exec John Schappert. Its emerging mobile strategy has failed to impress.

Zynga is the biggest fish in the social gaming pond, but videogame giant Electronic Arts is right up there on the charts, along with relative newcomers like King.com and Wooga. Disney never made much of Playdom in casual games, but its “Where’s my Perry” looks like it might be an iOS franchise. With increasing competition, it’s worth understanding whether Zynga’s troubles are unique to the company, or whether it is social gaming itself that is struggling.

Is “social gaming” a misnomer?

Tadhg Kelly, a game designer blogger, is on the money when he notes that most social gaming isn’t actually very social. Many so-called social gamers are just taking a quick break of time-wasting fun without necessarily involving a human opponent or collaborator. While there are unique characteristics to the current generation of social games – callouts to friends for help, integrated status updates – many are the natural successors to the kind of casual games like “Bejeweled” that have been around as long as the web. (And had paper-based predecessors before that.) In many ways, social networks are just a new vehicle to promote and distribute casual games.

Based on GigaOM Pro’s spring 2012 survey of U.S. online adults, social gamers and casual gamers have a lot in common. Twenty-five percent of online adults are monthly users of casual games – that’s a figure that hasn’t changed much over the years. Those casual gamers tend to be middle-aged women (61 percent female) and only 14 percent of them play multiplayer games like “Worlds of Warcraft.” Survey respondents who said they played games on social networks had similar demographic and behavioral characteristics. These social gamers make up about 15 percent of online adults and also skew female (60 percent) and middle-aged. Over half (58 percent) play casual games and 13 percent play multiplayer games. Thirty-six percent of mobile phone-owning social gamers play mobile games and 38 percent of casual gamers do so.

Social gaming strategies

Today, Zynga has built a billion-dollar business off of casual games built on Facebook’s social network platform. The company is metrics-driven – perhaps to a fault – in its effort to engineer games for frequent, casual usage, viral promotion, and virtual good sales to a relatively small number of heavy users. But there’s little evidence that those heavy users are classic hardcore videogamers or players of multiuser role playing games, so expanding into those genres probably won’t scale.

Casual gaming is a mature business in the U.S. Zynga and its social games competitors should follow these principles:

  • Manage the portfolio. It’s impossible to predict hits, so like other entertainment companies (movie studios, record labels) social games companies must manage a portfolio of titles, and jump on the ones that take off. Not every hit will be a franchise for sequels and spinoffs, so the key is launching lots of titles on a regular basis, doing as much analysis of them as possible, and vigorous cross-promotion.
  • Cultivate multiple revenue streams. Zynga has mastered virtual goods, but it needs to be more aggressive on sponsorship and in-game advertising. In fact, virtual goods-bartering shows a lot of promise as a sponsorship means. Facebook has enabled game and content subscriptions. That’s worth experimentation, but subscription may appeal more to hardcore gamers.
  • Build out the platform. I’ve given Zynga perhaps more credit than it deserves for starting to build its own platform. Successfully deploying APIs for technology and promotion to third-party game studios could help smooth out the ups and downs of the hits business, but only if social games platforms can generate revenues from licensing, advertising, or promotion fees.

Mobile might be different. Judging by the survey data, there’s reason to expect a similar number of mobile gamers will be high-spending “whales.” But that’s not proven yet, and apps stores are establishing a model of low-priced games rather than virtual goods. So mobile revenue experimentation is a must.

Question of the week

How can social gaming companies transition into mobile gaming?

Social platform players reveal diverging roles August 6, 2012

Posted by David Card in Uncategorized.
Tags: , , , ,
add a comment

Last week, Facebook and Twitter generated consternation within their respective ecosystems. Disgruntled developer Dalton Caldwell whined that Facebook found his app so potentially competitive that it “threatened” to buy him out. Meanwhile, Twitter had to apologize for temporarily shutting down a reporter who was helping feed a ruckus within its all-important Olympics-coverage network. These unrelated uproars illustrate key differences in the two dominant social media platforms. Facebook APIs channel data and technology services, but Twitter’s all about the data.

Both companies make social technology platforms that enable third-party developers using public APIs to build apps and services. Both platforms have spawned successful business ecosystems generating utility and value for mass-market audiences, app developers and web sites, and the platform companies themselves. Facebook has irked developers with its policy changes: particularly by making changes to how application activity gets shared among users, which can have a big impact on app traffic and promotion. Usually, it’s Twitter that gets accused of competing with its developers.

What matters for Facebook’s ecosystem

Although Google seemed only too happy to try to take advantage of whatever bad vibe Caldwell’s missive might create, the incident is a classic teapot tempest. This piece I wrote assessing the position of some social tech platforms and their ecosystems is still valid. For a thriving ecosystem, in addition to core technologies and support, would-be platforms need to give developers access to large and/or valuable audiences, distribution or even out-of-network syndication, data, and a way to make money.

Google has its own history of API inconsistency, but more important, Google+ hasn’t really clicked with users as a destination or place to use apps. And although Google is making some progress attracting marketers who value the potential for Google+ technologies to permeate other Google apps and affect search rankings, Google hasn’t connected its powerful ad networks to Google+ for developer revenue.

I doubt many developers fear that Facebook will compete with or buy them out, and an Instagram-like exit is an incentive, not a deterrent. Rather, a more serious Facebook platform issue is that its original platform poster child, the social games giant Zynga, is struggling lately. Zynga’s wounds are self-inflicted or the natural ebb and flow of managing a portfolio of entertainment titles. Zynga is experiencing sequel-itis and the fact that not all hits are instant franchises. But many see Zynga as a symptom of the Facebook platform’s vulnerability to increasing mobile usage.

This is premature, but worth monitoring. Mobile-only usage is starting to be noteworthy for Facebook, but some of that may be occurring in emerging markets where neither Facebook nor its ecosystem have business models to be damaged. And Facebook’s “sponsored stories” advertising format is showing early promise and can accommodate mobile usage. However, while individual gaming on mobile handsets is common, social gaming is less so. Neither has Facebook established its role in mobile app distribution or content discovery.

Twitter plays different role

Meanwhile, Twitter’s dust-up reveals the relative importance of the company’s roles within its own ecosystem. My GigaOM colleague Mathew Ingram writes equally about Twitter as an information utility, a media company, and a technology supplier. Yes, Twitter is a true platform, but its APIs are arguably far more important as a data source than they are as tools for developers building application functionality. The journalists, celebrities, and consumers that generate the content that flows through the Twitter network are a bigger part of the ecosystem than are third-party app developers.

So what are the takeaways from last week’s events? Facebook partners should stick close to the company’s budding mobile efforts, and experiment early and often. Caldwell’s concerns about Facebook’s business practices are overwrought, but questions about Facebook’s longer-term mobile platform and its ecosystem remain unanswered. And while Twitter is evolving its technology, developers should notice how much that evolution is about content display. Twitter may have some ideas about apps running within its platform, but Twitter’s most critical role is as an information and content distribution mechanism.

Question of the week

Which social media platform is more vulnerable?

“Unleashed” Zynga shows steady progress July 2, 2012

Posted by David Card in Uncategorized.
Tags: , , , ,
add a comment

The leader in social games hosted a “Zynga Unleashed” event last week where it showed a few new games and sketched in a little more of its platform, mobile and publishing network strategies. Market reaction amounted to a dismal, collective “meh.”

It’s been less than nine months since Zynga started to hint at the strategy that would launch its next stage of growth and reduce some of its dependency on Facebook. Last October Zynga began to talk about its grand vision of “Project Z” and “Zynga Direct,” and, in fact, the company is showing steady progress in implementing that vision. Third-party developers and Zynga competitors would be wise not to discount Zynga’s momentum. Last week, Zynga discussed its:

  • zCloud infrastructure. Zynga has built its own truly scalable infrastructure that it invites third-party game studios to use, both for core technologies and cross-title promotions. Zynga teased the idea of a new API for more backend services to come.
  • “Zynga with Friends” network. The infrastructure will support multiplayer game play and social communications across Facebook, mobile and web-based games. Zynga added three new developer studios for a total of nine on its platform.
  • Mobile distribution. Not only is Zynga becoming a web-based game publisher/distributor, but it aims to do the same on mobile devices. Atari joined four other game companies in signing on.
  • New titles. Zynga expanded its own portfolio of games across a handful of genres. There weren’t any obvious blockbusters, but Zynga showed a teaser trailer for a much-enhanced Farmville 2.

Adding growth opportunities

Together, these initiatives show how Zynga is slowly but surely building out its business and adding growth opportunities. It’s still tightly wedded to Facebook for audience growth and payments infrastructure. But it has started to show traffic growth on Zynga.com. More important, Zynga is trying to ensure that it doesn’t have to count on Facebook as a mobile distribution platform. That’s a good thing, as most observers, including Facebook itself, see mobile as one of the social network’s biggest challenges.

Zynga didn’t re-invent the games business. What it did was build a billion-dollar company off of existing consumer behavior at the expense of portals (MSN and Yahoo in particular) and other game companies. There has been a stable casual games audience – middle aged and female – since the dawn of the consumer web. That same 25 percent of U.S. online adults play social or casual games regularly, according to GigaOM Pro’s Q1 consumer survey. Zynga has mastered the narrow premium piece of that market, and is well-positioned to continue to dominate the virtual goods market GigaOM Pro forecasts to reach $4.3 billion in 2016, and even use it to tap into different “currencies,” like barter and ad-viewing.

Smoothing out impact of hits

Like most entertainment businesses, social games are driven by hits. By becoming a distributor and publisher of games from other studios, Zynga can flesh out its portfolio with potential big hits. It’s nearly impossible to predict blockbusters; disciplined companies manage a portfolio and franchise the winners. Franchise-related merchandise will likely pay off better than TV spinoffs.

Zynga is actually more like a TV network than a TV studio, though the analogy of fine-tuning titles rather than depending on opening weekend blowouts is apt. Like Zynga, the big broadcast networks have “owned and operated” studios and stations, with affiliates to expand distribution. Zynga hasn’t gotten that reciprocal distribution yet. And another thing it hasn’t pulled off – that the networks excel at – is to sell advertising effectively. In fact, Zynga is actually showing on its web games some ads that were sold by Facebook – the first hint of a Facebook ad network everyone has been expecting. Right now, Zynga’s not being aggressive in building out an ad platform (richer formats, sponsorships, targeting), but it could do so, or acquire some key parts. That’s more likely than Zynga getting into gambling, with all its regulatory headaches.

Question of the week

Where are Zynga’s best growth opportunities?

Browser wars, part IV May 29, 2012

Posted by David Card in Uncategorized.
Tags: , ,

Yahoo seemed to be taking a page from an old 20th century playbook last week when it introduced Axis, its browser/search hybrid app for iOS. And there’s a rumor circulating that Facebook might be looking at acquiring Opera. Does this mean we’re about to enter “Browser Wars, Part IV?”

Eighteen months ago, I wrote a short piece of analysis arguing that browsers don’t matter anymore. My thesis was that major technology platform providers like Google, Apple and Facebook weren’t using browsers as a key distribution channel or developer strategy for their APIs. Browsers might still play a role, I wrote, by offering a development platform to help alleviate fragmented operating system markets like mobile phones and connected TVs.

Has much changed since then? Microsoft has lost a little market share in desktop browsers, but the most established market tracker still has Explorer with a 30-point lead over Firefox and Chrome. OS and browser are tightly integrated for mobile phones and tablets, and we might even see that pattern re-emerge in desktop operating environments.

Yahoo’s chances

So what is Yahoo trying to accomplish? Shouldn’t the troubled portal be concentrating its allegedly mobile-first strategy on apps that have a chance? Like, for instance, its Livestand newsreader? Oh wait, it just killed Livestand.

Axis is getting surprisingly good reviews. (So did Livestand.) But when implemented as an app for iOS, it’s less a full browser than a skin on Apple Safari. Axis uses Safari’s rendering engine, and doesn’t override Safari when other browser-related functions come into play, like posting updates or photos. Axis is an intriguing search and web navigation app that presents page images rather than links as results, remembers a user’s search history across devices and enables a personal home page.

Axis gives a slick demo on an iPad. But page thumbnails are an inefficient way to display search results on smartphone screens, and there’s no evidence that Yahoo is tuning results for mobile use by, for example, re-ordering results based on GPS data. The success of Axis will depend on whether users perceive its approach to be fun or offering utility. Axis may be fun to use on a tablet, but it doesn’t stack up well against recent social search initiatives from Microsoft or Google easy-answer utility.

Surprisingly, although Yahoo is talking about the potential of Axis advertising, it’s not showing any ads or paid search results right now. That’s odd, since tablet ads might command a premium for their novelty and potentially rich interaction. Yahoo’s leaving money on the table and potentially taking away revenue opportunities for Microsoft, its search partner.

Browsers as platforms

If Axis catches on, it might increase usage of Yahoo search and content. But Yahoo appears to have wisely abandoned any notions about being a technology platform provider. It is not using Axis as a package of APIs connected to Yahoo services upon which third-party developers build apps.

Facebook is a another story entirely. I’ve written before about why Facebook would like to deploy its platform on devices via a somewhat site-centric HTML5 strategy, to ease multiple-OS support and get around app store restrictions. Its intent to buy Instagram and its own Camera app probably indicates bridge tactics toward that longer-term strategy.

Right now, Facebook mobile performance is poor. For security reasons, Apple restricts how apps use Safari’s rendering and JavaScript engines. Safari and other browsers use just-in-time compiling that enables applications to run faster by optimizing on-the-fly for particular hardware configurations. Opera also relies on a fast rendering engine and server-side caching for performance. Facebook might indeed benefit from access to those kinds of technologies. If it does acquire or build a browser, though, Facebook should “disguise” it as a speedy app, rather than trying to steal usage away from the device’s default browser.

Question of the week

Does Facebook need to own a browser?

Web development: Does Google matter? April 2, 2012

Posted by David Card in Uncategorized.
Tags: , , ,
add a comment

These days, the digerati are not showing a lot of love for Google. Last week, a Gizmodo piece summarized much of the criticism of the search giant, and encouraged others to pile on. There was much scoffing – if not outright derision – for Google initiatives: a consumer activity log, a forthcoming cloud drive and a possible online hardware store. If Google has lost faith among Silicon Valley pundits, does that mean it has lost relevance for web developers?

Mat Honan’s Gizmodo essay says Google is losing consumer trust as it shifts its focus from search towards integrating Google products with Google+ as glue. I suspect few mainstream consumers are aware of most of the sins Honan enumerates: e.g., end-running Safari settings, favoring its own products in search results, settling with the Justice Department over Canadian pharma ads, scraping data from a Kenyan business directory. They’re certainly not abandoning Google products like search (66 percent market U.S. market share), Android (46 percent) or Chrome (19 percent and growing). But Honan’s sense that Google has violated its Don’t Be Evil credo is echoed by a former Google engineering director, who agrees that Google’s business objectives take precedence over technology innovation.

Fundamental tensions

My GigaOM colleagues Bobbie Johnson and Barb Darrow point out how Google’s business practices lead to vulnerabilities with the developer community. Bobbie airs the complaint of a startup founder that Google gets developers hooked, then abandons or, worse yet, competes with them. Barb shows how Google must combat a feeling among developers that its current business focus means that some core technology platform services could be abandoned on a whim.

And Google’s platform strategy is shifting in a way that could alienate developers. Google has long been a pioneer in web technology platforms, through standards organization participation (W3C), its own APIs and services (search, Maps, AdWords) and casual mash-ups like embeddable YouTube videos. Over the years, Google has delivered its platform through widely distributed services rather than depending on a web destination for housing third-party applications. Google’s search site was in the business of driving users to other sites rather than holding onto them for extended sessions.

But several factors are driving Google towards creating web destinations, exposing fundamental tensions between its destination and services that make developers uneasy:

Back to basics

Google could restore a lot of developer faith if it re-learned one of its own lessons and adopted a few from Microsoft. Google’s Android strategy proves that the company knows that platform-building requires long-term investment. That’s why its decision to raise API licensing fees on Maps was puzzling and risky. Historically, not only has Google been liberal with its API licensing, it was the first platform that came with a ready-made revenue stream for developers via its ad networks. Google just introduced a revenue-sharing survey service for online publishers as an alternative to paywalls. That service would work just as well for apps.

Unlike Microsoft, Google has been open with APIs, but too hands-off with developer tools and support. Google’s Go programming language has never caught on, while it is slowly rolling out APIs for Google+ apps. Spending some more money and resources on developer support, including packages of training, tools and its popular analytics offerings could gain Google a critical edge over Facebook. Facebook’s app momentum comes from its audience growth and unique technologies; it hasn’t done a particularly good job cultivating developers.

Google’s search, unified communications, mapping and visualization technologies are still leading-edge. Developers are still interested in Google technology – tickets to its June I/O developer conference sold out in 20 minutes. Tying some revenue-sharing and support programs a little tighter would sweeten a lot of the bad taste left by recent business practices.

Question of the week

What can Google do to spark developer interest and trust?

Spotify, MOG demonstrate digital music flux March 26, 2012

Posted by David Card in Uncategorized.
Tags: , , , ,
add a comment

If the on-demand music streamer Spotify is worth $3 to $4 billion, why is MOG, a similar if much smaller service, reportedly being sold for $14 million? The digital music industry is in flux, but it’s showing positive signs of growth. Are those two players really so different?

Our recent GigaOM Pro digital music forecast described Disruption Vectors, market forces and trends that smart companies can use to gain revenue and market share in the near term. Our analysis rated Spotify as the company best positioned along several of the most important vectors: anywhere access, discovery and the highly disruptive rent vs. buy business model. But MOG scored well on those factors, too.

Network effect?

Would-be investors must think that Spotify can pull off a network effect based on its size and momentum, and on its efforts to establish itself as a technology platform for developers. Indeed, Spotify claims to have 10 million active users in comparison with MOG’s 500,000. But Spotify’s business model isn’t solidly established. Its contracts with rights holders will come up for renewal at some point, and there’s no telling what the labels well demand this time around. Rumor has it that the labels got upfront guaranteed payments. What more could they ask if Spotify raises even more money? The big labels already have equity positions in the company.

Meanwhile, Spotify’s platform strategy is smart, but limited. It is using APIs to attract apps that run within its own application. Recently, it has used this strategy to tap into another Disruption Vector: the changing role of record labels. Several labels, including Universal’s Def Jam, Warner Music and indies like Matador and Domino have built apps for Spotify. But Spotify should extend its APIs beyond its own application and become a streaming music and discovery provider for other companies’ sites and apps. That way, it would gain distribution and potential partner lock-in, both of which would maximize network effects toward a winner-take all outcome.

Closed loop

Meanwhile, MOG appears to be an acquisition target for the hot headphones manufacturer Beats Electronics. Beats, in turn, is majority owned by the big mobile phone handset maker HTC. HTC could be trying to put together a device-based, closed-loop system that could create a subsidized music service, another GigaOM Pro Disruption Vector. Although Nokia tried something similar and its program flopped, Deezer and Muve have had some success screening the cost of on-demand streaming by bundling it with voice and data services via carriers. But those efforts are carrier-driven rather than tied to hardware, which already has razor-thin margins for anyone but Apple.

It’s clear that, like all digital media, digital music services need to cultivate multiple revenue sources to thrive. That includes consumer fees, advertising and, perhaps, licensing. Both Spotify and MOG sell ads, but mostly to help subsidize free trials they hope to convert to paying customers. And that’s even though MOG has an ad network to sell inventory on other music sites. Audio ads are still a tough market, but video and display ads on apps might gain new momentum from tablets. MOG has a iPad app; Spotify does not.

Digital transition underway

Fees from consumers look attractive, but they’re hard to come by. Spotify doesn’t break out its numbers, though it has said it has 3 million paying subscribers worldwide. That would represent a phenomenally high conversion rate for digital content. GigaOM Pro’s Q1 consumer survey shows that only single digit percentages of music streamers (6 percent) have paid for a music service, although four times as many (25 percent) had bought a music download in the last three months.

There are strong hints of music listening substitution. Music streamers (27 percent of the U.S. online adult population) listen to local radio stations and CDs at the same rate as the rest of the population. But the subset of streamers whose primary listening mode is streaming  (8 percent of online adults) are lighter radio and CD listeners. Both groups are above-average users of music on their mobile phones.

The digital transition appears to be underway, but it’s likely to be a long slog. Players need multiple revenue streams and some means of staying power, whether that’s a sugar daddy parent company or tons of cash in the bank. Spotify has momentum, but I’d be wary of  overestimating its odds to be the sole survivor in streaming music.

Question of the week

How do you think music streaming will make money?

Why we should separate the real platforms from the pretenders December 5, 2011

Posted by David Card in Uncategorized.
Tags: , , ,

Everybody wants to be a platform. Spotify, the hot digital music service, is the latest company to sketch out a platform strategy. But building a real platform takes more than throwing out a few APIs and saying, “have at it.” To achieve business objectives like revenue growth, customer acquisition and network effects, would-be platform suppliers have to deliver audience, distribution and revenue potential.

Tech market observers use the term “platform” in a variety of ways. What I’m talking about here is a technology platform with application programming interfaces (APIs) that developers and sites use to build or enhance their own applications and services. On the consumer web, even a company with an industry-leading audience is vulnerable to competitors that supply better platforms. Myspace’s failure and Yahoo’s malaise are attributable to Facebook’s and Google’s platform prowess. Though both companies have or had big audiences, neither built out APIs that would enable distribution, data access or unique technology integration.

A successful platform delivers the following business benefits to its supplier:

  • Low-cost features. Spotify will instantly add a handful of compelling music features (discovery, touring info, lyrics) with minimal development costs.
  • Customer acquisition and retention. Facebook’s games and news apps increase usage duration and frequency, and its syndicated Connect and Like services both attract new users and bring them back regularly to the site.
  • High-margin revenue. Developers like Zynga that use a platform to attain a large audience and big sales don’t complain too much when Facebook takes a 30 percent cut.
  • Network effects. All of the above, along with viral sharing features like Follows, Likes and updates, encourages continuous connections between users and developers. That reinforces the core business and can lead to lock-in and platform dependency for developers and users both. Facebook claims to have 9 million businesses using it for promotion.

To attract developers, a platform must deliver something they want. That can be access to a big or specialized audience, core technologies and services developers can’t build themselves, and/or data, as well as distribution and potential revenues. Here is how some of the platform players in consumer and social media stack up. (A similar analysis framework applies to mobile, e-commerce and enterprise platforms.)


As illustrated, Spotify is delivering a medium-sized audience in a targetable music-fan context, and it has enabled app discovery and sharing. But it falls short on most measures.

Google’s major platform innovation was to deliver an easily accessible revenue stream to its search partners via revenue-sharing from its ad networks. Oddly, it hasn’t done this — yet — for Google+, as it wants to build audience first. Syndicated Google+ services promise indirect revenue benefits through search engine optimization. None of the players are particularly good at developer support, but Google has the strongest analytics tools offering.

Neither Twitter nor LinkedIn focus their platforms on getting apps for their site. Twitter’s platform is all about spreading its content and data to other sites, either through liberally open APIs (though the terms may shift) or licensing via Gnip and Datasift. It’s up to developers to make money. LinkedIn’s content and data syndication is aimed at increasing usage. Its pitch to sites would be stronger if it could build out a professional marketplace beyond hiring or if it exposed more customer information gleaned from its desirable professional audience.

Clearly, Facebook is the current master of the online consumer platform. Its balance of a semipermeable walled garden and widely distributed off-site technologies creates a potent potential for network effects. It doesn’t share ad revenues, but its Credits system enable cross-developer commerce. Companies building consumer platforms would be wise to emulate its tactics and offer competitive differentiation via support, revenue-sharing and specialized audiences.

Question of the week

Which companies are building killer platforms for other market segments?