The article below discusses the general importance of network effects for many businesses and how it can be dangerous to rely on such a phenomenon because it can be very difficult to come by. What I found interesting was a small comment saying how Google’s success did not rely on network effects, but rather an amazing technology service. It then mentioned that Google does use network effects in a small way because as more and more people use the service, Google can keep track of more search data and history to enhance everyone’s experience when the use Google and improve the probability that they find what they are looking for. Many companies have these small network effects that enhance their user’s experience not directly because there are more user, but because the increased number of users has allowed the company to get more data and deliver a more accurate and satisfying product. For example, as more people started using mail delivery companies, the companies were able to make shipments faster because there were more people so this naturally led to more equipment and technology which ultimately leads to a better service. Another example would be consulting companies because as the company gets more and more customers, they become more experienced and are able to give better solutions to their clients. This is why the best consulting companies will always be around, since they will always get customers and continue to improve their services. One last example is about taking courses. Imagine that you are in a certain course. What you learn is really not dependent on how many people there are in the class. But as more and more people take the course, the course tends to improve throughout the years and becomes of better educational value to the students.

http://technology.timesonline.co.uk/tol/news/tech_and_web/article3809879.ece