Metcalfe's law

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pages: 132 words: 31,976

Getting Real by Jason Fried, David Heinemeier Hansson, Matthew Linderman, 37 Signals


call centre, collaborative editing, iterative process, John Gruber, knowledge worker, Merlin Mann, Metcalfe's law, performance metric, premature optimization, slashdot, Steve Jobs, web application

And you'll be able to communicate without constantly having to worry about leaving people out of the loop. If you can't build your version one with three people, then you either need different people or need to slim down your initial version. Remember, it's ok to keep your first version small and tight. You'll quickly get to see if your idea has wings and, if it does, you'll have a clean, simple base to build on. Metcalfe's Law and project teams Keep the team as small as possible. Metcalfe's Law, that "the value of a communication system grows at approximately the square of the number of users of the system," has a corollary when it comes to project teams: The efficiency of the team is approximately the inverse of the square of the number of members in the team. I'm beginning to think three people is optimal for a 1.0 product release...Start out by reducing the number of people you plan to add to the team, and then reduce some more.


pages: 189 words: 57,632

Content: Selected Essays on Technology, Creativity, Copyright, and the Future of the Future by Cory Doctorow


book scanning, Brewster Kahle, Burning Man,, informal economy, information retrieval, Internet Archive, invention of movable type, Jeff Bezos, Law of Accelerating Returns, Metcalfe's law, mutually assured destruction, new economy, optical character recognition, patent troll, pattern recognition, Ponzi scheme, post scarcity, QWERTY keyboard, Ray Kurzweil, RFID, Sand Hill Road, Skype, slashdot, social software, speech recognition, Steve Jobs, Turing test, Vernor Vinge

The debate about redeeming Facebook starts from the assumption that Facebook is snowballing toward critical mass, the point at which it begins to define "the Internet" for a large slice of the world's netizens, growing steadily every day. But I think that this is far from a sure thing. Sure, networks generally follow Metcalfe's Law: "the value of a telecommunications network is proportional to the square of the number of users of the system." This law is best understood through the analogy of the fax machine: a world with one fax machine has no use for faxes, but every time you add a fax, you square the number of possible send/receive combinations (Alice can fax Bob or Carol or Don; Bob can fax Alice, Carol and Don; Carol can fax Alice, Bob and Don, etc). But Metcalfe's law presumes that creating more communications pathways increases the value of the system, and that's not always true (see Brook's Law: "Adding manpower to a late softer project makes it later").


pages: 218 words: 63,471

How We Got Here: A Slightly Irreverent History of Technology and Markets by Andy Kessler


Albert Einstein, Andy Kessler, automated trading system, bank run, Big bang: deregulation of the City of London, Bretton Woods, British Empire, buttonwood tree, Claude Shannon: information theory, Corn Laws, Edward Lloyd's coffeehouse, fiat currency, floating exchange rates, Fractional reserve banking, full employment, Grace Hopper, invention of the steam engine, invention of the telephone, invisible hand, Isaac Newton, Jacquard loom, Jacquard loom, James Hargreaves, James Watt: steam engine, John von Neumann, joint-stock company, joint-stock limited liability company, Joseph-Marie Jacquard, Maui Hawaii, Menlo Park, Metcalfe's law, packet switching, price mechanism, probability theory / Blaise Pascal / Pierre de Fermat, profit motive, railway mania, RAND corporation, Silicon Valley, Small Order Execution System, South Sea Bubble, spice trade, spinning jenny, Steve Jobs, supply-chain management, supply-chain management software, trade route, transatlantic slave trade, transatlantic slave trade, tulip mania, Turing machine, Turing test, William Shockley: the traitorous eight

The talk was dull, but as a slide demonstrating uses of 10 gigabit and soon 100 gigabit Ethernet networks flashed on the screen, I noticed a funny look on Bob Metcalfe’s face: He was half stunned, half amused that Ethernet is still scaling from those 2.94 megabit per second beginnings. 150 HOW WE GOT HERE Metcalfe is also known for another famous observation – that the value of a network goes up by the square of the number of nodes attached to it. The official definition of Metcalfe's Law is: The value of a network grows as the square of the number of its users. Actually, for those keeping track at home, it’s n*(n-1). A single node has no connections, two nodes have 2 connections, one in either direction, three nodes have 6, etc. This becomes the scale of the Web when millions of nodes are connected, and Metcalfe’s Law is what made Napster and peer-to-peer file sharing such a huge phenomenon. Bob told me, “Unlike Moore's Law, Metcalfe's Law has never been actually numerically true. It's a vision thing. You can quote me.” *** Local area networks, LANs, became extremely popular in hooking up mainframes and minicomputers.


pages: 370 words: 105,085

Joel on Software by Joel Spolsky


barriers to entry,, George Gilder, index card, Jeff Bezos, knowledge worker, Metcalfe's law, Network effects, new economy, PageRank, Paul Graham, profit motive, Robert X Cringely, shareholder value, Silicon Valley, Silicon Valley startup, six sigma, slashdot, Steve Ballmer, Steve Jobs, the scientific method, thinkpad, VA Linux, web application

It's not impossible to displace a competitor, if that's what you want to do. (I'll talk about how to do that in the next chapters.) Another question about displacing competitors has to do with network effects and lock-in: Ben & Jerry's Amazon No network effect, weak customer lock-in Strong network effect, strong customer lock-in A network effect is a situation where the more customers you have, the more customers you will get. It's based on Metcalfe's Law:1 The value of a network is equal to the number of users squared. A good example is eBay. If you want to sell your old Patek Philippe watch, you're going to get a better price on eBay, because there are more buyers there. If you want to buy a Patek Philippe watch, you're going to look on eBay, because there are more sellers there. Another extremely strong network effect is created by proprietary chat systems like ICQ or AOL Instant Messenger.

Microsoft server failure recovery–2nd setup programs in–2nd and Transmeta listening to customers–2nd Lister, Timothy–2nd "lite" products–2nd lock-in strategies–2nd log files in bug fixing log in forms–2nd Longhorn system API changes for Microsoft investment in support for Lord Palmerston question Lotus 123 delayed release for, 2nd marketing strategies for–2nd low-memory conditions M Macintosh advertising for backward compatibility in Pascal strings in macro development in Excel–2nd macroeconomics mainframes malloc function man pages management strategies Juno–2nd Microsoft–2nd managers characteristics of–2nd for functional specifications–2nd hiring–2nd at Juno nontechnical–2nd software schedule input by–2nd manifests Manzi, Jim mapping in Unicode marketing chicken-and-egg problems–2nd product switching barriers–2nd viral–2nd marketing people blunders by as program managers master programmers–2nd maybes, interviewing–2nd McConnell, Steve McDonald's, rules at–2nd McFarlane, Jill measurements dysfunction from–2nd by Naked Chef Measuring and Managing Performance in Organizations (Austin)–2nd mechanism, separating policy from Media Lab memory for bloatware memory management automatic–2nd SimCity mentoring difficulties–2nd meta tags Metcalfe's Law methodology limitations Michelman, Eric Michelson, Amos microeconomics Micropro blunders Microserfs (Coupland) Microsoft. See also Windows bill presentment system blunders business model management strategies–2nd master programmers–2nd opposing forces inside–2nd program managers–2nd Microsoft Project–2nd Microsoft Typography group mistakes in business strategies in programming questions money, substituting for time–2nd, 3rd monopolies, transition tipping points for–2nd mood swings morale and performance reviews Mozilla program completion of cross-platform problem in delays in, 2nd as open source size of switching to MSDN Magazine Camp at Microsoft–2nd victories of–2nd MSN Auctions site multiple-person interviews multitasking–2nd Murphy's Law week frozen pipes Linux server failure–2nd web server down–2nd Murray, Mike mystrcat function myths 80/20–2nd testers–2nd Unicode–2nd N Naked Chef–2nd native facilities with Java negative performance reviews .NET backward compatibility of for cell phones cross-language strategy hype for–2nd memory management in–2nd products using runtimes in–2nd, 3rd–4th strategy for moving to–2nd as upgrade product–2nd white paper for Netscape.


pages: 247 words: 81,135

The Great Fragmentation: And Why the Future of All Business Is Small by Steve Sammartino


3D printing, additive manufacturing, Airbnb, augmented reality, barriers to entry, Bill Gates: Altair 8800, bitcoin, BRICs, Buckminster Fuller, citizen journalism, collaborative consumption, cryptocurrency, Elon Musk, fiat currency, Frederick Winslow Taylor, game design, Google X / Alphabet X, haute couture, helicopter parent, illegal immigration, index fund, Jeff Bezos, jimmy wales, Kickstarter, knowledge economy, Law of Accelerating Returns, market design, Metcalfe's law, Minecraft, minimum viable product, Network effects, new economy, post scarcity, prediction markets, pre–internet, profit motive, race to the bottom, random walk, Ray Kurzweil, recommendation engine, remote working, RFID, self-driving car, sharing economy, side project, Silicon Valley, Silicon Valley startup, skunkworks, Skype, social graph, social web, software is eating the world, Steve Jobs, too big to fail, web application

INDEX 3D printing access and accessibility see also barriers; communication; digital; social media — factors of production — knowledge adoption rates advertising see also marketing; mass media; promotion; television Airbnb Alibaba Amazon antifragility Apple artisanal production creativity audience see also crowd — connecting with — vs target Away from Keyboard (AFK) banking see also crowdfunding; currencies barriers Beck (musician) big as a disadvantage bioengineering biomimicry biotechnology bitcoins blogs borrowed interest brand business strategies change see disruption and disruptive change Cluetrain Manifesto co-creation coffee culture Cold War collaboration collaborative consumption collective sentience commerce, future see also retail and retailers communication see also advertising; promotion; social media; social relationships — channels — tools community vs target competition and competitors component retail computers see also connecting and connection; internet; networks; smartphones; social media; software; technology era; 3D printing; web connecting and connection see also social media; social relationships — home/world — machines — people — things consumerism consumption silos content, delivery of coopetition corporations see also industrial era; retail and retailers; technology era costs see also finance; price co-working space creativity crowd, contribution by the crowdfunding cryptocurrencies culture — hacking — startup currencies see also banking deflation demographics device convergence digital see also computers; internet; music; smartphone; retail and retailers, online; social media; social relationships; technology; web; work — cohorts — era — footprint — revolution — skills — strategy — tools — world disruption and disruptive change DNA as an operating system drones Dunbar's number e-commerce see retail and retailers, online economic development, changing education employment, lifetime see also labour; work ephermalization Facebook see also social media finance, peer to peer see also banking; crowdfunding; currencies Ford, Henry 4Ps Foursquare fragmentation — of cities — industrial — Lego car example gadgets see also computers; smartphone; tools games and gaming behaviour gamification geo-location glass cockpit Global Financial Crisis (GFC) globalisation Google hacking hourglass strategy IFTTT (If this then that) industrialists (capital class) industry, redefining industrial era see also consumerism; marketing; retail and retailers — hacking — life in influencers information-based work infrastructure — changing — declining importance of — legacy innovation intention interest-based groups see also niches interest graphs internet see also access and accessibility; connecting and connection; social media; social relationships; web In Real Life (IRL) isolation iTunes see also music Jumpstart Our Business Startups (JOBS) Act (USA) keyboards knowledge economy lab vs factory labour see also work — low-cost language layering legacy — industries — infrastructure — media Lego car project life — in boxes — in gaming future — hack living standards see also life location see place, work making see also artisanal production; retail and retailers; 3D printing malleable marketplace manufacturing see also artisanal production; industrial era; making; product; 3D printing; tools — desktop marketing see also advertising; consumerism; 4Ps; mass media; promotion; retail and retailers — demographics, use in — industrial era — language — mass — metrics — new — post-industrial — predictive — research — target — traditional mass media ; see also advertising; marketing; media; promotion; television — after materialism media see also communication; legacy; mass media; newspapers; niches; television — consumption — hacking — platform vs content — subscription Metcalfe's law MOOC (Massive Open Online Course) Moore's law music Napster Netflix netizens networks see also connecting and connection; media; social media; social relationships newspapers see also media niches nodes nondustrial company Oaida, Raul oDesk office, end of the omniconnection era open source parasocial interaction payment systems Pebble phones, number of mobile see also smartphones photography Pinterest piracy place — of work platforms pop culture power-generating technologies price see also costs privacy see also social media; social relationships product — unfinished production see also industrial era; product; 3D printing — mass projecteer Project October Sky promotion see also advertising; marketing; mass media; media quantified self Racovitsa, Vasilii remote controls RepRap 3D printer retail cold spot retail and retailers — changing — digital — direct — hacking — mass — online — price — small — strategies — traditional rewards robots Sans nation state economy scientific management search engines self-hacking self-publishing self-storage sensors sharing see also social media; social relationships smartphones smartwatch social graphs social media (digitally enhanced conversation) see also Facebook; social relationships; Twitter; YouTube social relationships see also social graphs; social media — digital software speed subcultures Super Awesome Micro Project see Lego car project Super Bowl mentality target tastemakers technology see also computers; digital; open source; social media; smartphones; social relationships; software; 3D printing; work — deflation — era — free — revolution — speed — stack teenagers, marketing to television Tesla Motors thingernet thinking and technology times tools see also artisanal production; communication; computers; digital; making; smartphones; social media; 3D printing — changing — old trust Twitter Uber unlearning usability gap user experience volumetric mindset wages — growth — low — minimum web see also connecting and connection; digital; internet; retail and retailers, online; social media; social relationships — three phases of — tools Wikipedia work — digital era — industrial era — location of — options words see language Yahoo YouTube Learn more with practical advice from our experts WILEY END USER LICENSE AGREEMENT Go to to access Wiley’s ebook EULA.


pages: 378 words: 110,518

Postcapitalism: A Guide to Our Future by Paul Mason


Alfred Russel Wallace, bank run, banking crisis, banks create money, Basel III, Bernie Madoff, Bill Gates: Altair 8800, bitcoin, Branko Milanovic, Bretton Woods, BRICs, British Empire, business process, butterfly effect, call centre, capital controls, Claude Shannon: information theory, collaborative economy, collective bargaining, Corn Laws, corporate social responsibility, credit crunch, currency manipulation / currency intervention, currency peg, David Graeber, deglobalization, deindustrialization, deskilling, discovery of the americas, Downton Abbey,, energy security, eurozone crisis, factory automation, financial repression, Firefox, Fractional reserve banking, Frederick Winslow Taylor, full employment, future of work, game design, income inequality, inflation targeting, informal economy, Internet of things, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kevin Kelly, knowledge economy, knowledge worker, late capitalism, low skilled workers, market clearing, means of production, Metcalfe's law, money: store of value / unit of account / medium of exchange, mortgage debt, Network effects, new economy, Norbert Wiener, Occupy movement, oil shale / tar sands, oil shock, payday loans, post-industrial society, precariat, price mechanism, profit motive, quantitative easing, race to the bottom, RAND corporation, rent-seeking, reserve currency, RFID, Richard Stallman, Robert Gordon, secular stagnation, sharing economy, Stewart Brand, structural adjustment programs, supply-chain management, the scientific method, The Wealth of Nations by Adam Smith, Transnistria, union organizing, universal basic income, urban decay, urban planning, wages for housework, women in the workforce

Eichengreen, ‘A Requiem for Global Imbalances’, Project Syndicate, 13 January 2014 34. 35. 36. L. Floridi, The Philosophy of Information (Oxford, 2011), p. 4 37. M. Foucault, The Birth of Biopolitics: Lectures at the Collège de France, 1978–79, trans. G. Burchell (New York, 2008) 38. 39. ‘Measuring the Internet Economy: A Contribution to the Research Agenda’, OECD, 2013 40. H. Braconier, G. Nicoletti and B. Westmore, ‘Policy Challenges for the Next 50 Years’, OECD, 2014 2. LONG WAVES, SHORT MEMORIES 1. N. Kondratieff, Letter, 17 November 1937, in N. Makasheva, W. Samuels and V. Barnett (eds.), The Works of Nikolai D. Kondratiev (London, 1998), vol. IV, p. 313 2.


pages: 1,201 words: 233,519

Coders at Work by Peter Seibel


Ada Lovelace, bioinformatics, cloud computing, Conway's Game of Life, domain-specific language, fault tolerance, Fermat's Last Theorem, Firefox, George Gilder, glass ceiling, HyperCard, information retrieval, loose coupling, Menlo Park, Metcalfe's law, premature optimization, publish or perish, random walk, revision control, Richard Stallman, rolodex, Saturday Night Live, side project, slashdot, speech recognition, the scientific method, Therac-25, Turing complete, Turing machine, Turing test, type inference, Valgrind, web application

Bloch: There are multiple communities associated with Java and with other programming languages too. When there aren't, it's usually a sign that the language is either a niche language or an immature language. As a language grows and prospers, it naturally appeals to a more diverse community. And furthermore, as the amount of investment in a language grows, the value of it grows. It's like Metcalfe's law: the value of a network is proportional to the square of the number of users. The same is true of languages—you get all these people using a language and all of a sudden you've got Eclipse, you've got FindBugs, you've got Guice. Even if Java isn't the perfect language for you, there are all these incidental benefits to using it, so you form your own community that figures out how to do numeric programming in Java, or whatever kind of programming you want to do.