via Peterme, an Economist article argues that Yahoo’s business strategy is contradictory — they want to provide content, and to provide tools for user-generated content.
The Economist’s analysis misses two key points about networked business models.
- the Long Tail. Chris Anderson rightly argues that businesses providing “niche content” benefit from having popular content as a draw. A shopper might come for ColdPlay and find less popular artists through the recommendations. There’s no conflict, and a lot of benefit, to having a broad spectrum of content from commercial hits through homegrown productions
- the Lead User. Services like search and blogging and mapping are streamlined for convenience-seeking, mainstream users. At the same time these services have APIs that allow “lead users” to craft more specialized applications that build on these basic services.
The Economist quotes John Battelle to make its point: