Business model analysis of interest-based social networking services

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School of Business | Master's thesis
Information Systems Science
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Objectives of the study This research paper sets out to examine interest-based social networking services and the underlying business models that provide the logic for value creation, delivery, and capture. The objective of this paper is to uncover the common characteristics of interest-based social networking services' business models in order to understand the necessary building blocks that need to be present for a new service to function properly. Furthermore, it aims at giving managerial suggestions for companies that are planning to launch an interest-based social networking service. Academic background and methodology The research in this paper is based on an extensive literature review on social networks, evolution of the internet, online social networks and their respective business models. The paper continues to examine the theory behind business models, which provides the grounds for choosing a business model framework that is used in the empirical part of the thesis. The empirical part of this paper is conducted as an observatory case study. The results of the empirical study are utilized to uncover the key characteristics of interest-based social networks and to provide general guidelines for new entrants that are launching a similar service. Findings and conclusions The research shows that interest-based social networking services use the same technical and basic functions when it comes to the design and implementation of the platform. The services are built based on the user interest graph rather than on existing social connections that are imported from other services. This interest graph works as the basis of the services and is tightly linked to the underlying business model components.
business model, social network, value proposition, digital service, digital media, revenue stream
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