Group Forming Networks Resource Page

This web exists to link to the online resources I want to share that relate to group forming networks, scaling, “Metcalfe’s Law” and “Reed’s Law”.  Please contact me with others that you find interesting. – David P. Reed

My writings,  presentations, and talks

That Sneaky Exponential – this article gives an overview of how value created by connectivity scales, and shows how “group forming” architectures outcompete “transactional” architectures.

Weapon of Math Destruction – this Context Magazine article published in Spring 1999 presents the 2ⁿ scaling law of group forming networks in a brief way.

Exponents of Change: How Scale Creates Value in Network Communities – (powerpoint) slides presented at my keynote talk at the T3 Conference in Pittsburgh, April 2000, relating scaling laws and network business models.

The Law of the Pack – Harvard Business Review article published in February 2001 issue talks about Reed’s Law and its business implications. (this article isn’t readable online, but you can order reprints).

David Weinberger (co-author of The Cluetrain Manifesto) interviewed me for the 1/19/01 Journal of the Hyperlinked Organization on why group-forming matters.

Responses, Citations, etc.

The Economist’s annual review, called “The World in 2001”, discussed Reed’s Law in an article by Alun Anderson called The Mathematics of Mayhem. [Note: deleted from the Economist site, citations to www.archive.org’s Wayback Machine]From A Digital Bit – a nice set of very short briefings put out in 1999-2000 by Jay Kingley of Diamond Technology Partners on Digital Strategy. The January briefing introduces my model of economic scaling laws for communities of value, calling it Reed’s Law (it’s actually my 3rd Law). Other issues are: September, October, November (introduces communities of value concept), December (creating value in communities online), January (why community value creation becomes dominant).

Other resources

Other ideas that relate to group forming and network scaling.

W. Brian Arthur’s work on increasing returns in economics describes a range of ideas including the idea of network externalities.  For example, his Harvard Business Review article, Increasing Returns and the New World of Business or his book Increasing Returns and Path Dependence in the Economy.

Nicholas Economides maintains a fascinating site devoted to network economics.

Carl Shapiro and Hal Varian, Information Rules – a nice book that talks about economic theory that relates to networks.

Larry Downes and Chunka Mui talk about increasing returns in their book Unleashing the Killer App and at the book’s site http://www.killer-apps.com.

Francis Fukuyama, in his book Trust – the Social Virtues and the Creation of Prosperity, talks about how cultures that have what I would call an “architecture for affliliation” have succeeded relative to other cultures in creating wealth.

Michael Bannen recently mentioned a nice article by Jakob Nielsen about “Reverse Metcalfe’s Law”.  That is, what happens to value when you let network “owners” destroy connectivity to create proprietary, poorly connected domains that they control.  The same argument, with worse result, applies when group-forming is blocked by barriers or rules that limit who can group with whom, giving  the “Reverse Reed’s Law” – locking out a minority of M members reduces potential value for all by a factor of 2^M.

I should probably cite other works that focus on “social capital” in forming groups. De Tocqueville certainly covers the general idea.

I should also probably cite WWW sites that have good architectures for group and affiliation formation…