Comments on: still misunderstanding micropayments http://blog.ginsudo.com/2009/02/09/still-misunderstanding-micropayments/ the way of ginsu Sun, 18 Jul 2010 14:36:25 +0000 hourly 1 http://wordpress.com/ By: ginsu http://blog.ginsudo.com/2009/02/09/still-misunderstanding-micropayments/#comment-30 ginsu Tue, 10 Feb 2009 03:43:39 +0000 http://blog.ginsudo.com/?p=120#comment-30 I'm saying that your notion of competition *within* a service is based on a mistaken notion of what is being purchased. And, perhaps, a mistaken belief that these services mean to be <a href="http://blog.pmarca.com/2007/09/the-three-kinds.html" rel="nofollow">a true platform</a>, at least with respect to virtual goods. Again: No one is buying an icon of a flower. People are buying an icon of a flower <em>that is displayed on Facebook</em>. There's plenty of competition in pictures of flowers. There's no competition in pictures-of-flowers-on-Facebook, because only FB is FB. If you want to compete against that, you do so by starting another social network. ETA: One more example, though it's not a perfect analogy: Let's say I buy a nylon jacket from the designer John Varvatos. It's worth a significant amount of money. Now, I can buy and sell nylon, I can even cut my jacket into squares and sell those pieces. But those items would not be worth very much. What is worth what I paid is the design from Varvatos, what it signifies to others who see this garment associated with me, the experience and service at the store, the status, etc etc. There's not a question of competition for nylon. The competition is from Ted Baker or Ben Sherman or their ilk. I’m saying that your notion of competition *within* a service is based on a mistaken notion of what is being purchased. And, perhaps, a mistaken belief that these services mean to be a true platform, at least with respect to virtual goods.

Again: No one is buying an icon of a flower. People are buying an icon of a flower that is displayed on Facebook. There’s plenty of competition in pictures of flowers. There’s no competition in pictures-of-flowers-on-Facebook, because only FB is FB. If you want to compete against that, you do so by starting another social network.

ETA: One more example, though it’s not a perfect analogy: Let’s say I buy a nylon jacket from the designer John Varvatos. It’s worth a significant amount of money. Now, I can buy and sell nylon, I can even cut my jacket into squares and sell those pieces. But those items would not be worth very much. What is worth what I paid is the design from Varvatos, what it signifies to others who see this garment associated with me, the experience and service at the store, the status, etc etc. There’s not a question of competition for nylon. The competition is from Ted Baker or Ben Sherman or their ilk.

]]> By: Clay Shirky http://blog.ginsudo.com/2009/02/09/still-misunderstanding-micropayments/#comment-29 Clay Shirky Tue, 10 Feb 2009 03:09:46 +0000 http://blog.ginsudo.com/?p=120#comment-29 You're confusing two kinds of monopoly -- there is competition *between* Cyworld and other social network services. There is not, however, competition within those services. Put another way, if you can create a technology platform that operates at a competitive advantage to other platforms, you can have non-competitive behavior within that platform. You’re confusing two kinds of monopoly — there is competition *between* Cyworld and other social network services. There is not, however, competition within those services. Put another way, if you can create a technology platform that operates at a competitive advantage to other platforms, you can have non-competitive behavior within that platform.

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