The Social NetWAR (Part 2/2)

Of the three big social networks, I find LinkedIn to have the highest potential. LinkedIn offers an irreplaceable and invaluable services.

Less than 13% of Facebook users are above the age of 44; the majority of users are between the age of 18 and 25. Despite LinkedIn's smaller user pool, the majority of LinkedIn users have higher education level and higher income. This makes LinkedIn a channel to a "niche" market. There is a reason for this, and that reason is the intrinsic value of the services it provide: professional networking.

http://www.quantcast.com/linkedin.com/demographics

People working in the same industry are bound to have "3rd level" connections (for example: A knows B, B knows C, so A is connected to C). However, this connection is difficult to be unveiled through probability and randomness of strong and weak network-interactions; there is simply no time at an interview for you and the interviewer to go through your entire network to find a mutual connection. Enters LinkedIn. LinkedIn fully reveals a person's professional network. This network access allows firms to improve its hiring decisions, speed up negotiation processes, and allow faster information flow. In terms of value creation, LinkedIn wins.

Despite some analysts are predicting Facebook will disappear in 8 years, sharing the fate of MySpace, I think Facebook will remain as a large social network that plays a large part in the lives of Generation Y. But as we grow older and get busier with our professional and private lives, Facebook will see a reduction in activity levels unless it captures the attention of the next generation. Exactly how Facebook could achieve such? Time will tell.

EDIT: Looking at the stock prices since my last post, $26 is indeed the best time to buy.