1. The Future Of Social Networks Charlene Li Vice President & Principal Analyst Co-author of Groundswell Forrester Research March 4, 2008

2. 2 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

3. 3 They are online with their social networks

4. 4 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

5. 5 Theme Social networks will be like air.

6. 6 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Components of social networks Profile Relationships Activities Business model Universal identity A single social graph Social context for activities Social influence defines marketing value

7. 7 Entire contents © 2008 Forrester Research, Inc. All rights reserved. My multiple identities

8. 8 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Universal identity cli@forrester.com me@charleneli.com Mobile number

9. 9 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Universal identity foundations Federation (OpenID approach) A few major players will serve as major federation focal points »Yahoo!, Microsoft, Google, Plaxo, etc. All players must realize that they can grow the market faster/better by working together »Data Portability Group is the beginning

10. 10 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Bill of Rights for Users of the Social Web “We publicly assert that all users of the social web are entitled to certain fundamental rights, specifically: Ownership of their own personal information, including: »their own profile data »the list of people they are connected to »the activity stream of content they create; Control of whether and how such personal information is shared with others; and Freedom to grant persistent access to their personal information to trusted external sites.” - Authored by Joseph Smarr, Marc Canter, Robert Scoble, and Michael Arrington http://blog.broadbandmechanics.com/2007/09/a-bill-of-rights-for-users-of-the-social-web

11. 11 Entire contents © 2008 Forrester Research, Inc. All rights reserved. My Facebook social graph Missing Colleagues Parents Extended family School parents Neighbors Babysitter Walking group

12. 12 Entire contents © 2008 Forrester Research, Inc. All rights reserved. My real social graph is much more complex

13. 13 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Let’s end the insanity

14. 14 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Relationships today are explicit – and a pain Twitter Facebook LinkedIn Plaxo

15. 15 Entire contents © 2008 Forrester Research, Inc. All rights reserved. New “entrants” will challenge the incumbents Millions of regular users Search & deep content Ad and content networks Relationship maps

16. 16 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Relationship mapping will be automatic and permission-based

17. 17 Entire contents © 2008 Forrester Research, Inc. All rights reserved. What people do today on social networks

18. 18 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Dave has a nice book review on Facebook

19. 19 Entire contents © 2008 Forrester Research, Inc. All rights reserved. But it would be more helpful on Amazon “See friends’ reviews”

20. 20 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Search based on what my friends finds relevant See which of my friends owns a Focus – and what they think of it Compare daily portfolio performance to friends’ Elevate stories tagged by friends – anywhere How Yahoo! could incorporate social networks

21. 21 Entire contents © 2008 Forrester Research, Inc. All rights reserved. The under-rated value of networks

22. 22 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Endorsement value depends on your network Your authority on the specific topic Your network’s interest and authority on the topic The trust level among your network on the topic

23. 23 Entire contents © 2008 Forrester Research, Inc. All rights reserved. The future business model for social networks Marketers will pay to reach and influence valuable Each person will have their own “personal CPM”* Social networks will compete to have the best experience for high-influence individuals * From Marian Salzman, JWT

24. 24 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Walled garden services Portal aggregators Evolution of open platforms 199319992003 2008-9 2013 Search freedom Data portability Ubiquitous social networks

25. 25 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Recommendations Create linkages between services based on individually-controlled identity federation Compete on creating the most compelling social experience, not social graph lock-in Develop social applications that have meaning Integrate social networks into existing activities Design business models that reflect the value created by people’s social networks

26. 26 Entire contents © 2008 Forrester Research, Inc. All rights reserved. Charlene Li +1 650.581.3833 cli@forrester.com www.forrester.com groundswell.forrester.com Thank you