Network Effects, Small-World Phenomenon, and Intellectual Property Rights

Several recent posts discuss the impact of network effects. sithswine182 discusses how Zune, Microsoft’s new mp3 player, relies on network effects and why its strategy has not been successful. timo writes about Dell’s endorsement of Ubuntu Linux and what kind of implications this might have for future operating systems that wish to leverage network effects.

rorschachex also discusses Dell’s decision to support Ubuntu Linux, but from the perspective of voting and information cascades. Dell’s decision was a direct result of its new IdeaStorm site, which allows the public to vote on new product design concepts.

Several posts discuss the internet’s role in the small-world phenomenon. Both starvinmarvin and md6 argue that the internet helps create random edges (i.e., those defined in the Watts-Strogatz model), and thus is responsible for the small diameter of the global social network. someone cites a study by Duncan Watts and colleagues at Columbia University that confirms the six degrees of separation phenomenon using an email experiment.

On the other hand, ocj2 discusses a paper written by Judith Kleinfeld which discredits Stanley Milgram’s findings in support of the small-world phenomenon. Kleinfeld argues that although mathematicians have developed computer models of how the small world phenomenon could logically work, empirical evidence suggests that we actually live in a world deeply divided by social barriers such as race and class. She claims that the popular belief of the small-world phenomenon is mostly due to psychological reasons.

portmanteau, jmholloway and frozenatcornell all discuss Digg’s DVD-decoder fiasco, which is an incident covered by our class lecture on intellectual property rights. Digg deleted several posts which linked to articles revealing a code which can allegedly be used to circumvent the digital rights management on HD-DVDs and Blu-ray Discs. In response, angry Digg users flooded the site with references to the code and criticized the site’s decision to censor content. Digg shut down at one point, and then returned online with a message from Kevin Rose, Digg’s founder. In the message, he declared that he would not delete any more articles that contain the code. The Digital Rights Management (DRM) group has threatened the bloggers with legal action.

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