Is Facebook becoming too popular? Do social networks have a tipping point? ReadWriteWeb calls it the reverse network effect. To understand the network effect, think about the fax machine. The first fax machine was worthless. Absolutely worthless, because it couldn't send the fax to anyone else; no one else had a fax machine. The more people that purchased fax machines, the more value each machine had, i.e. the bigger the network, the better the network.

A reverse happens when the scale of the network drives away users. Is Facebook too popular? Maybe. Skype, they say, will be one of the only networks immune to it.

Skype gets more useful with each new user, and each new user promotes Skype, consciously or unconsciously, for his or her own reasons. Even better, the cost of providing the service goes down with each new user, and that is really unusual (a function of Skype's P2P architecture). Google and PayPal also benefit from each new user, but they still have to service that user, and that costs money. In the case of a video service such as YouTube, the servicing cost is significant. So Skype really is in a league of its own when it comes to network effects, and that is why it may become the world's largest telephone company and the biggest economic success story of the Web 2.0 era. (Google Voice, having just thrown its hat in the ring to battle Skype, will be interesting to watch. My bet is on Skype.)

MySpace topped out and, once Facebook came along, it was relegated to second-class status. Well maybe that's overstating it - it still serves it's original purpose for bands and such.
But now Twitter is coming up in Facebook's rear view mirror. What next?

My Facebook crave never reached even modest levels, but I have a page. I reached a tipping point recently when some undesirable outcomes and unforeseen visitors started to ruin my experience. I think that's when the reverse started for me. I immediately cut to 20 friends and hid myself. Why 20? Why not? I had to draw the line somewhere. This even led to an embarrassing conversation where I told a friend that he made the cut, only to realize soon after that he did not. Marc, I swear you were number 21 (just missed)!