Social network theory, broadband and the future of

TelecommunicationsPolicy32(2008)62–84Socialnetworktheory,broadbandandthefutureoftheWorldWideWeb$DanielSgroiDepartmentofEconomics,UniversityofWarwick,GibbetHillRoad,CoventryCV47AL,UKAbstractThispaperaimstopredictsomepossiblefuturesfortheWorldWideWebbasedonseveralkeynetworkparameters:size,complexity,costandincreasingconnectionspeedthroughtheuptakeofbroadbandtechnology.Thisisdonethroughtheproductionofataxonomyspecificallyevaluatingthestabilitypropertiesofthefullyconnectedstarandcompletenetworks,basedontheJacksonandWolinsky[(1996).Astrategicmodelofsocialandeconomicnetworks.JournalofEconomicTheory,71,44–74]connectionsmodel,modifiedtoincorporatecomplexityconcerns.Thetaxonomydemonstratesthatwhenconnectionspeedsarelowneitherthestarnorcompletenetworksarestable,andwhenconnectionspeedsarehighthestarnetworkisusuallystable,whilethecompletenetworkisneverstable.Forintermediatespeedlevelsmuchdependsupontheotherparameters.Underplausibleassumptionsaboutthefuture,thetaxonomysuggeststhattheWebmaybeincreasinglydominatedbyasingleintermediatesite,perhapsbestdescribedasasearchengine.r2007ElsevierLtd.Allrightsreserved.Keywords:Socialnetworktheory;Stability;Broadband;WorldWideWeb1.IntroductionRecentlyineconomics,aliteraturehasemergedlookingathownetworksdevelopinsociety.AgoodsurveycanbefoundinJackson(2005),focusingonsocialnetworks,andBloch(2003),whichprovidesausefullistofapplicationstoindustrialorganization.Thepotentialrangeofapplicationisconsiderable,fromsocialnetworks,informationnetworksinfirms,tophysicalnetworks,suchastheInternetorbroadbandnetworks,thoughtheInternethassofarreceivedsurprisinglysparseattention.Possibleexceptionsexist,forexample,ananalysisofpeeringandtransitintheInternetbyBadasyanandChakrabarti(2003),butstillnotasmuchasthesizeandimportanceoftheInternetmightwarrant.1Akeyfeatureofthecurrentliteratureonsocialnetworkformationisthatnetworksarenotnecessarilyplannedcentrally,orevenpronetomuchcontrol,theyoftensimplyemergeandevolve,whichisacharacteristicoftheInternetandtheWorldWideWeb.AsecondrelatedARTICLEINPRESS:10.1016/j.telpol.2007.11.008$FundedbytheEUFP6SpecificSupportAction‘‘Competition,ContentsandBroadbandfortheInternetinEurope’’IST-2004-2012(D8).Tel.:[phone];fax:[phone].E-mailaddress:[e-mail]1ThatisnottosaythattherearenotmanyexcellentstudiesoftheInternetorWorldWideWebwhichuseempiricalmethods;forexample,thestudyofthediameteroftheWebbyAlbert,Jeong,andBarabasi(1999).literaturelooksatwhatmakesanetworkoptimal,whichrepresentsapossibleend-statetothisprocessofevolution.Perhapsthekeycriterionlinkingthesetwoliteraturesisthenotionofnetworkstability.Shouldanindividualuserbeabletocreateanewlinkinanetworkandshouldthisimprovehisorherutilitythenitseemsreasonabletoassumethatitwillbedone,atleastinthemediumtolongrun.Eventually,however,astatemightbereachedwherenoonewouldbenefitfromachangetothenetworkstructureandthisseemsagoodcandidateforthelong-termrestingpointofthenetworkformationprocess.Adichotomyexistsbetweentheliteratureonsocialnetworktheorywhichtendstodealwithlinksbetweenindividualsorfirmswhichareoftencheaptoinitiate,andsothedefactocostmaycomeintermsofcongestionorcomplexity,andphysicalnetworkswherelinksareoftenveryexpensivetobuildandmaintainandhencehaveahighdirectcost.Take,forinstance,thedecisiontomakeaworkcolleagueawareofyourareaofexpertiseversusthedecisiontobuildanewroad,gaspipelineorrailwayline.Thebigcostinthefirstcasemightbetheconcernthatonceidentifiedyoumightfaceagreaterworkload;intermsofthesecondcasethereisaconsiderablecosteventobuildingthelink.TheInternetprovidesaninterestinghybrid.Itisagenuinelyphysicalnetwork,butonewhereconnectingtoagivenexistingnetworkisrelativelycheapintermsofdirectcost,withmuchoftheanalysistakingplaceintermsofassociatedcostslikecomplexityornetworkexternalityeffectsonotherswhichmightseemmorerelevantconcernsforthesocialnetworkliterature.ThispaperseekstousesomeoftheexistingtoolsofsocialnetworktheorytoanalyzetheWorldWideWebandbroadbandaccess.AtaxonomyofpredictionsforthefutureoftheWebisdevelopedinwhichtheimpactofhigh-speedbroadbandaccesscanbejudged.Togiveanoverview,firsttheJacksonandWolinsky(1996)connectionsmodel,anarchetypalsocialnetworkmodel,ismodifiedtoincorporatedifferingconnectionspeedsandcomplexitycosts.Second,thisnewmodelisappliedtotheWorldWideWebandataxonomyofpredictionsforthefutureoftheWebisformulated.Finally,aresidual,butimportant,aimofthepaperistoshowhowsocialnetworktheorycanassistinassessingthefutureimpactofbroadbandaccess,andisbynomeansanexhaustiveattempttocompletethetask,ratheritpresentsanumberofstartingpointsforresearch.Section2developsaconnectionsmodelfortheWeb,definingnotation,andexaminingthearchetypalnetworkstobeusedthroughout,andendswithaparticularlyimportantlistoflimitationsandpotentialextensionstotheunderlyingmodelusedinthispaper.Section3examinesthekeyconceptofstability,andSections4and5applythisconcepttothestarnetworkandcompletenetworkinturn.Section6summar