Recommended reading is Olag Kharif's brief report in this week's BusinessWeek on "Social-Networking Sites Open Up". It has the sub-head "Facebook, Friendster, and others are starting to let third-party developers build new features to attract more users - and profits". The article predicts many of the bigger social network sites like MySpace, LinkedIn, and Friendster will follow the lead of the Facebook API and make their networks available as web services.
What's the motivation?
Social-networking sites are realizing that if they want to grow their user base - and build a sustainable business model - they need to attract third-party developers. "Social networks have reached a point of maturity, and opening APIs will help them grow," explains Adam Trachtenberg, a senior manager for eBay. ... "Part of what's exciting about a developer community is you don't know what people are going to do," says Lucian Beebe, director of product management at LinkedIn, which is considering opening up its software. "It offers you the ability to harness innovation." ... "This is really just the tip of the iceberg," says Mark Zuckerberg, Facebook's chief executive officer. "We realize we can never provide all applications [our users want]."
The other "why" factors cited are branding, traffic and revenue growth:
Whenever Google's map pops up on Yelp, so does the Google logo. "This is tied directly to branding and traffic," says Bret Taylor, a senior product manager at Google. Taylor also points out that new applications allow more people to discover your site, which can translate into greater revenues since more viewers mean higher ad rates.
After social network Friendster opened up its proprietary software to a select dozen or so developers six months ago, the number of unique visitors rose by 17.6%, to 18.8 million, in December, 2006. "This is our biggest [month-over-month] growth since launch," says Jeff Roberto, marketing director at Friendster. Now, for example, Friendster users can create slide shows of photos on Slide.com and then post them directly onto the social-networking site.
Given that social networking sites have until now been notoriously walled gardens, it will indeed be interesting to see how this year plays-out for them on the API front.