“It’s a bubble. Social networks have been around for a long time,” he says. “Friendster is feeding off the hype. People get excited about joining a network and use it for a couple of months but once they get to know people they’ll use other communication like email or IM.” He likens it to fads such as weblogging, which has a higher abandonment rate, or flash mobs.
It isn’t just VCs who see an opportunity in the hype. Wiki-fiddlers, or HTML coders who have been unemployed since the last dot.com explosion, are also hopeful that this represents a change in fortune. But Friendfinder’s CEO thinks they might all be disappointed.
“I’d like to see the conversion rate when Friendster starts charging for the service. How many people will pay even $10 or even $5 a month, when they have access to their Outlook Express inbox for free?” [The Register]
Certainly an interesting consideration. I was speaking with some people about this very thing today and it seems that after a short while, Friendster interest wanes drastically. Not sure how the professional networks are faring, but I would think they have a slower rate of attrition.