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Will Bill or Mark or Someone Else Build The Social Suite of Category Killer Apps For Facebook?

Speculation has begun about TheUADA (see TechCrunch.com’s article TheUADA: Biggest Facebook App Co or Marketing Scam, AllFacebook.com’s article TheUADA: A United Front For App Developers, see FaceReviews.com article TheUADA: Mystery Entity Tops Adonomics Top 40 App Companies ). Folks are curious as to what TheUADA is, who the members of TheUADA are, which services TheUADA will offer to Facebook developers, when TheUADA will have its IPO and how TheUADA will effect the Facebook eco-system in general. All of these speculations by the press and the blogosphere are actually a healthy part of the process.

My current favorite comment came from a valley researcher inspired by the TechCrunch article who was frustrated by the lack of folks willing to comment about TheUADA:

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1. Slavish Excess
February 18th, 2008 at 12:12 pm
I saw this THEUADA thing today as well. An hour of followup and research yielded zip. There is no way something this big on Facebook goes uncommented unless they have a waterboarding clause for violating their NDA.
>>

Well, I can guarantee Slavish Excess that the NDA for TheUADA doesn’t have a waterboarding clause. That being said, the best way to find out everything about TheUADA is to stay tuned to TheUADA.com web site on Feb. 29, 2008.

The one area I am willing to talk about is the future of app development on Facebook and the evolution of the first Social Operating System in comparison with the evolution the first Graphical Operating System Windows.

Building the Microsoft Office Suite of Productivity Apps for Windows

When the first mainstream graphical operating system in the form of Microsoft Windows first arrived in 1984, Steve Ballmer was able to demonstrate just a few Windowing Apps. Specifically, Clock and Calculator. Given the 640K DOS application program memory footprint and the 640 x 240 primitive bit map display, simultaneously running these two apps plus the desktop with icons and windows plus DOS plus the Windows User Interface was viewed as a major accomplishment. However, Windows was not yet ready for prime time in terms of being a platform for office productivity applications.

Over the next 11 years, Windows 1.0, 2.0, 3.0 all shipped and the hardware advanced from 8086, 386, 486 and the available memory grew from 640K, 1MB, 2MB, 4MB. This set the stage for Windows 3.1 launch (the first usable version of Windows) and finally Windows 95 (the first mainstream version of Windows). When Jay Leno stood on the stage with Bill Gates and talked about Windows 95 to a crowd of press and Microsoft employees the “long march” to Graphical Operating System dominance was complete.

In addition, Bill Gates had wisely used these 11 years to bet heavily in the Windows Application space. Starting with Excel on the Mac which he then ported to Windows and Word for Windows which was built on the MS Word for DOS product and via acquisition of PowerPoint for Windows and Visio for Windows, Microsoft put together the cornerstones of the Office Suite of Productivity Apps. The Suite Wars at the time started when Microsoft linked their apps together via document interchange and similar user interface conventions in a manner that made it hard for stand-alone app providers like Word Perfect or Lotus to compete.

One can say that Microsoft leveraged their control of Windows to dominate the application space. However, I think that it was really the Windows app developer community that missed the boat. Microsoft took 11 years perfecting the Windows platform and this should have been plenty of time for another company to pull together a suite of category killer apps for Windows. That opportunity passed all of us by, but I think a similar opportunity is staring the Facebook developer community in the face today.

Building the Social Suite of Category Killer Apps for Facebook

If you investigate The Adonomics 100™ Top App Companies , you will note that some new names are starting to climb the charts. Specifically, #4 Zynga and #20 Social Gaming Network have been adding apps to their companies much faster than they could develop them. Instead of developing the apps, they have been acquiring them outright or acquiring exclusive marketing rights to these apps. My belief is that they are each making a play to be the dominant Casual Gaming App Company on Facebook. There approach is to offer upfront cash, salaries and options to their participating members. This type of consolidation and safety/strength in numbers is inevitable in a space like Casual Gaming because a person doesn’t just want to play one game with their friends forever. They want to have a little variety and yet not lose track of their leaderboard status as one app shrinks in popularity and another app grows.

By my count, the Casual Gaming Category is the Eighth major category of killer apps for Facebook that has emerged.

The First Category was the Friend Communication Category. The dominant App Companies in this category are Max Levchin’s #2 Slide and Lance Tokuda and Jia Shen’s #3 RockYou and they have gone back and forth attempting to win the Wall Wars, the Poking Wars and Slideshow Wars. Each of these apps (along with Profile Expression apps like Top Friends, Fortune Cookie, Horoscopes), work together with Facebook’s own Newsfeed, Photos, Events apps to turn your profile page into a “Bloomberg Terminal for Your Life.” The Friend Communicaiton App Category is probably the most evolved segment in the Social Suite of Category Killer Apps that is just now starting to emerge.

The Second Category was the Music Category. Ali Partovi of #11 iLike was first mover in this space and still dominates.

The Third Category was the Movies Category. Joe Greenstein of #8 Flixster was first mover in this space and still dominates.

The Fourth Category was the Monsters Category. Blake Commagere (the inventor of the “invite-centric” app with Vampires, Zombies, Werewolves and Slayers apps that collectively have 20 million installs) of #7 Commagere Ventures created a category of apps that has spawned a myriad of imitators. What is clear about this type of app is that it has staying power and serves some basic need in human beings. What is unclear is what that need actually is. The one thing I know is that the app category makes money and is the envy of both Zynga and Social Gaming Network and a few other companies who would love to have Blake’s App Installs added to their Adonomics 100™ ranking.

The Fifth Category was the Fans Category. Justin Smith of #9 WaterCooler, Inc. is the master of this strategy of using individual Facebook apps like Addicted to Simpsons, Addicted to Lost, New England Patriot Fans, Green Bay Packer Fans, plus 450+ more focused fan apps, to fish for micro, mini and maxi audiences within the ocean of 70+ million Facebook users. His top Fans Apps have 700,000+ installs each and collectively represent 350,000+ Daily Active Users. This Fans Category is full of lots of tiny long tail apps but when you bind them all together they become very interesting to the exact same advertisers that might be interested in the Simpsons demographic, the Lost demographic or the Monday Night Football fan demographic.

The Sixth Cateogry was the Dating Category. Cliff Lerner of #14 SNAP Interactive is the current leader in this space. I would expect that it will be only a matter of time before he starts using his public stock currency to start buying up other Facebook apps that fall into the flirting/dating category such as some of the Stanford Class apps like: Best Match!, KissMe, Hugs, Bless You, etc. It is quite likely that this category will be one of the first to enjoy a significant amount of acquisition activity by the likes of Match.com and eHarmony.com because if they can afford 10’s of millions for TV ads, they can surely afford the millions it would cost to buy their way to dominance in this dating category within Facebook. However, if they don’t act quickly, an investment in SNAP Interactive might be a very interesting play.

The Seventh Category was the Gifting Category. #21 Zach Allia was actually the second mover here (after Facebook’s own Paid Gifts app) and he remains an important player in the space. Keith Schacht with #10 42 Friends has since surpassed Zach with total installs, although it is possible Zach still has more uniques than Keith because Zach has only the one app almost 8 million installs vs. Keith’s three apps that have been heavily cross-promoted. This category is morphing right now to include various Real Gifts apps and I believe that in the long run, Gifting will be a very lucrative category based on real transactions. This will be especially true when Facebook’s payment system is developed and released.

The Eighth Category was the Casual Gaming Category. As mentioned above, Mark Pincus’ #4 Zynga and Shervin Pishevar’s #20 Social Gaming Network are battling it out in this space via an acquisition / licensing strategy.

The Ninth Category was the Friend Comparison Category. Naval Ravikant started the ball rolling here with his Compare People app that is now a part of #5 Chainn Inc. Suleman Ali is another important player in this space with his Superlatives app this is owned by #6 esgut. Each of these app companies have a variety of apps in this category and in certain adjacent areas.

The Tenth Category was the Self Expression Category. Markus Weichselbaum of #13 TheBroth has some of the most interesting apps in this category (e.g., numerous quotes apps and the infamous What’s Your Stripper Name app). Markus and his team at TheBroth are also masters of an emerging category tied to social interaction in the graphic space with their highly innovative PuzzleBee app. This category has lots of other miscellaneous apps from a long tail of tiny app companies. The bottom line is that people like to make fun of themselves and also use their profile page to send a message about what they care about. Facebook’s Groups app would also fall into this category, despite the fact that Groups have much more potential within Facebook than merely being a “badge” or “tatoo” users display on their profile page to show they care. The last major player in this Self Expression Category is the Causes app from #17 Project Agape.

The First 10 App Categories and Their Role in the Social Suite

The leading apps in the First 10 App Categories in the Social Suite are as follows:

1. Friend Communication — Top Friends, Fun Wall, Super Wall, SuperPoke!
2. Music — iLike
3. Movies — Movies
4. Monsters — Vampires, Zombies, Werewolves, Slayers
5. Fans — Addicted to ____, _______ Fans
6. Dating — Are You Interested?
7. Gifting — Free Gifts, Growing Gifts, Hatching Eggs
8. Casual Gaming — Texas Hold’em, Ghost Racer, Jetman
9. Friend Comparison — Compare People, Likeness, Likeness Unrated
10. Self Expression — Fortune Cookie, My Questions, What’s Your Stripper Name?, Causes

The Killer Apps represented in these initial leading App Categories helped Facebook grow 5x in 2007 (from 12 million active users to 60+ million). The staying power of the current leaders in each of these categories will vary. However, the categories themselves will still be important 5, 10 or 15 years from now. This is similar to the way that the leaders in the Word Processor Category, which was one of the first Killer App Categories for PC’s, have changed over the years shifting from WordStar to Word Perfect to WORD. Apps may come and go, but App Categories remain.

The real question now is what comes next?

One area I’ve already written about is the Super Groups category. In addition to Super Groups, I see the following contenders for future inclusion in the Social Suite of Category Killer Apps:

TBD — stay tuned