A couple of talented developers with enough time and resources can leverage the current open-source ecosystem and blockchain infrastructure to orchestrate the development of digital networks and re-think it’s value distribution from the ground up.
Human-content market fit
A lot of innovation took place in the last 20 years. Fierce startup competition leaded the way for a trillion-dollar social media industry to emerge and with it, billion-dollar private companies. At first, it seemed this networks didn’t stand a chance of survival because they had no revenues. Later they struck gold when they discover a new ad targeting business model based on data mining and exploitation.
If you think deeply about some of these companies (YouTube, Reddit, Twitter, TikTok, Medium, Substack) they are just humans interacting with each other. On one side you have content creators and on the other content consumers. Each one of these startups monopolized a certain content format (Long posts, short posts, long videos, short videos, newsletter, etc.). Many of them take all the revenues generated without sharing it with its creators.
Web2 networks are too big right now and they offer cheap convenient interaction and good software powered by great network effects. Everyone uses them, so the networks are more valuable. We need radical innovations to break these networks effects and create new ones. I have an idea for a framework of how web3 network effects could be kick-started.
Community
We need to start, as Thiel says, with a small niche in a big market. Which community is already using crypto technology in an ubiquitous way and understand its principles as well as its technicalities? Web3 developers could be a great niche to monopolize and kick-start new network models.
Build
What kind of format would be ideal to engage with this community, a format where they are comfortable and it’s already battle tested in the market? I’m thinking of a blogging platform, like medium, hashnode.dev, dev.to, etc. A place where they can write technical web3 articles. The code should be open-source and maintained by the same developers that participate in it.
Business
How can we incentivize adoption having already bigger and better networks like Medium? Transparent revenue sharing. If creators and developers maintain the networks they should get all the revenues. If we create a subscription model and an ad’s model, then based on an algorithm each creator should receive through smart contracts what corresponds to the traffic he generates. Charging readers and advertisers in tokens would allow the payments to 100% trustless and automated.
DAO
A DAO is a new type of business for the new era. This kind of business doesn’t have to spend in things like marketing, legal or accounting, since everything is automated through tokens and organic growth. A small percentage should go to a DAO that guides the development and allocation of resources. We don’t need a CEO with millions of dollars in stock compensation. It’s just a blogging platform. A team of well-paid developers should be enough.
Governance
People should be responsible for the roadmap and the big decisions. A DAO governance with token voting should be the best way to run a decentralized blog.
Attention
Another idea, more complex, would be to incentivize readers. They contribute to the network so why not also rewarding their attention? Even if it’s a small percentage, some sort of reading gamification with token/nft could be implemented.
Conclusion
With all these tactics combined a real digital economy should be created. With Tokens and NFT's allows for unimaginable things that contribute to the economy’s growth and sustainability. Write to earn may be a thing. And maybe… read to earn.
Breaking web2 network effects will take time. We are going to need great dapps, better UX, new business models and clever strategies. Meanwhile, we keep moving towards these future with great web3 projects like Lens.
To make my point about how easy we can start creating our own networks I developed a simple decentralized blogging app. If you are interested in talking about the project, please reach to me!
To learn more about web3 technology, refer to my other posts. For more information, feel free to reach out on Twitter, or fguespe@gmail.com.
