When an inspired entrepreneur is pitching yet another social network project to a seasoned VC and says, "we will compete with Facebook", a reflective thought goes through the mind of said VC: "Buddy, your competition is another start-up and you’re not even aware what they are doing".
All true, until the rules of the game change and an Open Social Platform arrives.
Are you skeptical? You are not alone. People were very skeptical about open spectrum, open networks (Internet), open software (Linux) until goliaths (closed systems) were defeated. And here we go again.
All major social networks are closed systems:
The main purpose of closed systems is to maximize profits for their shareholders, not users (despite all the marketing). And the best way to protect any business from competition is to introduce some barriers:
Companies spend substantial resources on innovation, but the main purpose of that innovation is to extract maximum value from users, while keeping them glued to the service. Eventually these closed social systems create too much friction and inconvenience for everyone involved.
Today users must maintain multiple social profiles, submit the same content over and over again to different networks, manage fragmented audiences and all that while being bombarded with intrusive advertising.
Businesses don’t fare much better either. Besides maintaining presence according to the rules of these systems, they are also forced to use dedicated ad systems which lack transparency and impose lots of restrictions.
In this context, a new paradigm emerges - an Open Social Platform powered by distributed blockchain technology.
The fundamental innovation of the Open Social Platform is that users keep their profiles, their connections and content on the public blockchain. You may even think of it as a content cloud - one place for everything.
Users are free to use any app to interact with the blockchain, access their own records and communicate with their friends. In fact, followers might all use different apps and remain perfectly connected and in sync.
App creators do not need to ask permission to build apps on a distributed blockchain. Contrast this to Facebook app vetting! With open blockchain, the floodgates of innovation are open. Creativity and experimentation are no longer the privilege of the few. Anyone can try a different approach, anyone can experiment or build an app.
Blockchain is organized in such a way that apps cannot break the integrity of the distributed database, they cannot change the history or add records on behalf of users without their knowledge. Users always remain in control of their online identities and their wallets.
Businesses no longer need to employ sneaky advertising techniques to get attention of potential customers. They can communicate with their target audiences directly through the blockchain by bidding for their attention. Users may choose to accept bids, ignore them or request higher payouts.
Users, businesses and app creators interact with each other through the blockchain using simple and transparent rules. This changes everything.
Or does it? After all, how can these unorganized developers ever build anything worth something? Don't you need a well-organized company with proper management structure to do real stuff?
In closed systems innovation is prioritized based on the addressable market to ensure return on investment remains high, and much innovation is rejected by committees, boards and consultants.
Open systems offer an entirely different approach to innovation: anyone can build and try something new. When this is coupled with open software development approach, everyone can learn from others, build on top of each others’ work and reassemble ideas in new ways.
At early stages it may seem that open platforms have a long way to go to match mighty established players. But before long, the gap narrows down and they surpass old systems by an order of magnitude enabling users to do previously unimaginable things. Open platforms become great foundations for new businesses, new products and services.
We've seen the history repeat itself multiple times, yet this time something feels very different.
It was not possible to buy shares of open spectrum, open software or the Internet. If you were lucky, you bought Amazon, if not - Pets.com. You could invest in companies that were built on top of open platforms, but not platforms themselves.
This time around you can buy Open Social Platform tokens or earn them by either submitting quality content, curating content of others, investing in bots and more.
Tokenized Open Platform effectively funds its own development, content acquisition and all other services that contribute to the overall value of the platform.
All function layers remain open and much of software development is open source. Anyone can innovate, anyone can take things further. And every new experiment increases the overall value of the platform.
And here comes the network effect:
Competing apps and bots use the same token and that creates a combined network effect for the entire Open Social Platform. It is no longer a zero sum game. Each new customer, each new connection and every new article or report increases the value of the platform.
Interests of app creators and users are perfectly aligned: apps earn 5%-10% from user earnings, including attention and reference trades. It is in the best interest of app creators to maximize profits of their users by offering them content feeds that match their interests and offer the best opportunities to earn platform tokens.
Small apps enjoy the same profitability as much bigger ones, because their users equally compete for author and curation rewards, for attention and reference bids as well as other resources of the platform.
In turn, businesses can safely bid for attention of combined audiences of all apps, using domain expertise of users, which was verified and confirmed by the community. This level of transparency is unimaginable in current closed social systems.
Open Platform ensures that users are the main beneficiaries of their labor, enables rapid innovation and allows investors to participate in the success of the platform.
All these factors create a very powerful combination, which puts Open Social Platform in a unique position to achieve mass adoption.
