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Strategic Questions
(Chapter 2)Think about positive network effects taking place in your business, ecosystem, and industry. To what extent do you actively consider and work with positive network effects as a fundamental process for accelerating and multiplying your business value? Are you effective at monetizing network effects? Why or why not?
G.ho.st most definitely actively considers positive network effects within the hosted virtual desktop community that they have established. Users are allowed free accounts with 15GB of storage, allowing the ability to quickly upload and share documents with other users or make files public for everyone to use. Each user is offered an additional 5GB of storage space for each new user they recruit into the community as well, enticing people to spread the word about the unique community.
In addition to staying focused on establishing and building the community within the G.ho.st environment, the company has also effectively monetized these network effects. Within each free G.ho.st account is a Google search bar which allows users quick access to Google search. Through Google AdSense, G.ho.st receives revenue for each advertisement that is clicked through this search feature. As more users join G.ho.st, this revenue is compounded and increases exponentially the more users access their account and use the search function.
(Chapter 3) Consider an upcoming product or service launch for your business. Based on the key elements of online social networks that were explored using Facebook and LinkedIn, what might you do to help identify the 1-3% active uploaders in your current community and support them as customer evangelists? How could you put into place platforms and services that invite viral marketing as well as viral distribution?
For G.ho.st, a potential upcoming launch of a new product or service could be made much more successful by having the user base back the launch and spread news through word of mouth. As with Facebook and LinkedIn, the value of the social networks grew as more and more users came on board and started adding their own value to the mix. G.ho.st has this same ability, with users sharing their files publicly or with friends, the value in the overall network can grow as more users add their new files when signing up for an account.
As it stands right now, G.ho.st is not very organized with the way they list public files on the network. Although users have the ability to show a specific file type, the most popular files, and search for a specific keyword, the files are all put into one large folder in alphabetical order by file type. The problem with this is that as more users make files public, the ability to browse through files and find files related to what you are looking for becomes similar to finding a needle in a haystack.
One possible solution to this problem is to allow organization of files by user and develop a way of identifying users who share the most files and specifically the files that are downloaded most by other users. These users could be contacted by G.ho.st with a proposition to help develop a tool for organizing the documents so that they are easier to browse through by users. In a similar fashion to Wikipedia, it is possible that small percentages of users are responsible for the majority of the content being provided on G.ho.st. By offering these users incentives for continuing to provide this content and help organize it, more positive network effects can be achieved when new users join and see that the data is so well organized and displayed.
As for viral marketing and distribution, G.ho.st already has in place an incentive for current users to gain an additional 5GB of storage space for every friend that is recruited to create a G.ho.st account. When each person first logs into G.ho.st, they are also prompted to invite their friends and connect their account with a Facebook username.
These types of viral distribution and marketing could significantly help G.ho.st to add new users to their network and create positive network effects and a good user experience in order to continue to have new users invite their friends to the network.
(Chapter 4) How and when do you see Web 2.0-enabled dynamic capabilities disrupting the current practices, business model, competitive advantages, and economics of your business and industry? What is the risk of being a leader or laggard? When should this become a boardroom agenda item?
The dynamics of the hosted virtual desktop market are still very much up in the air at this point. Although the industry is currently only generating $1.5 billion, it has been estimated to grow to $65.7 billion in revenue and have over 49 million users by the year 2013. Each competitor within the market is looking to make a name for themselves and become the industry leader. Being a leader in this industry takes a lot of money and effort due to the fact that it is an emerging technology that has not yet matured to its full potential. However, the high expenses being paid by early entrants far outweigh the risks of being a laggard to the industry once several firms have established themselves and filled niches.
At this time, the major competitors are focusing on large businesses with many employees that wish to organize their files within the cloud and make them easily accessible for their employees. There do seem to be several niches within the HVD industry that are starting to be filled by the smaller competitors. G.ho.st tailors to home-based users that wish to connect, upload, and share their files in a central location that can be accessed from many locations.
One change within the industry that could very well impact G.ho.st is the switch from desktop PCs to hosted virtual desktops. By 2014, it is predicted that 15% of current worldwide traditional desktop PCs will migrate to hosted virtual desktops(http://www.eweek.com/c/a/Virtualization/VMware-Citrix-Microsoft-Reap-Benefits-from-Hosted-Desktop-Virtualization-262027/). This switch is a very crucial one since currently the G.ho.st environment requires that users login from a computer with a traditional operating system and browser. G.ho.st must establish a way for users to directly connect to their service in order to capture a share of this 15% that will be migrating to strictly hosted services.
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