Forbes – How To Value Your Networks

—My info: http://mstolp.cfofa.com

Last week Bill Gates told a business forum in New Delhi why he quit Facebook: He was overwhelmed by the number of friend requests coming his way.

That’s a perfect example of the economics behind ICANN Chief Executive Rod Beckstrom’s model for how to value a network. In a keynote speech Friday at Defcon, Beckstrom, former director of the U.S. National Cybersecurity Center, laid out an economic model for valuing not only Internet networks, but also social ones.

“Beckstrom’s Law” says that the value of a network is the net value of each user’s transaction summed up for all users. At its core, the concept is about transactions: The value for users is the total benefits from all transactions in a network minus the cost of those transactions.

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Posted by J. Michael Stolp from my Blackberry.