Metcalfe’s law

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Valley of Genius: The Uncensored History of Silicon Valley (As Told by the Hackers, Founders, and Freaks Who Made It Boom)

by Adam Fisher  · 9 Jul 2018  · 611pp  · 188,732 words

Xerox PARC and then founded 3Com to commercialize the standard. He is one of a select few in Silicon Valley to have his own “law.” Metcalfe’s law states that the value of a network is proportional to the square of the number of its users. Jane Metcalfe is, with Louis Rossetto, the

The Power Law: Venture Capital and the Making of the New Future

by Sebastian Mallaby  · 1 Feb 2022  · 935pp  · 197,338 words

a personal computer would rise exponentially when it was hooked up to a network, they both agreed. Indeed, this insight came to be known as Metcalfe’s law: the value of a network rises with the square of the number of devices connected to it. A few days later, Krause met Howard Charney

this phenomenon. Again, Doerr grasped this better than most others. As well as working at Intel, he had known Bob Metcalfe, so he understood that Metcalfe’s law was even more explosive than Moore’s law. Rather than merely doubling in power every two years, as semiconductors did, the value of a network

network would jump ninefold, an effect massively more powerful than the mere doubling in the power of semiconductors over that same period. What’s more, Metcalfe’s law was not supplanting Moore’s law, which would have been dramatic enough. Rather, it was compounding it. The explosion of internet traffic would be fueled

both by its rapid growth in usefulness (Metcalfe’s law) and by the falling cost of modems and computers (Moore’s law).[71] After listening to Clark’s pitch, Doerr was determined to invest. A

initial stake, but the upside was unbounded. Given what the power law meant for startups, what Moore’s law meant for computing power, and what Metcalfe’s law meant for networks—and given how each law compounded the effect of the others—Mosaic Communications was one of those options you just had to

that was driving it. Unlike Yahoo, which was pouring money into marketing, eBay’s marketing budget was zero. Its hectic expansion was instead propelled by Metcalfe’s law: as the size of its auction network grew, its value rose exponentially. The more sellers listed stuff on eBay, the more bargain hunters were drawn

’s troubles is partly correct. Astonishingly, the firm that had minted money during the first internet wave, preaching the power of Moore’s law and Metcalfe’s law, rushed into a sector that lacked these magical advantages. And yet there is another side to the story—one that reveals a subtler truth about

-1 Registration Statement: Netscape Communications Corporation,” Securities and Exchange Commission, June 23, 1995, 48. BACK TO NOTE REFERENCE 69 Doerr commented, “Metcalfe taught me about Metcalfe’s law, and I could see that the value of a network would grow with the square of the number of users. So Netscape could be huge

.” Doerr, interview by the author, Sept. 13, 2018. BACK TO NOTE REFERENCE 70 For a lucid analysis of the relationship between Metcalfe’s law and Moore’s law, see Bob Metcalfe, “Metcalfe’s Law Recurses Down the Long Tail of Social Networks,” VC Mike’s Blog, Aug. 18, 2006, vcmike.wordpress.com/2006/08/18/metcalfe

Melchor, Jack, 103, 105–6 Menlo Ventures Uber, 354, 355–57, 368 UUNET, 141, 144 Merrill Lynch, 93 Metcalfe, Bob, 99–107, 110, 147, 153 Metcalfe’s law, 147–48, 165, 263, 437n Metropolitan Fiber Systems, 137, 139, 143–44 Microsoft, 51, 143, 181, 273, 298 military contracts, 18–19, 394–95, 417n

How We Got Here: A Slightly Irreverent History of Technology and Markets

by Andy Kessler  · 13 Jun 2005  · 218pp  · 63,471 words

2 connections, one in either direction, three nodes have 6, etc. This becomes the scale of the Web when millions of nodes are connected, and Metcalfe’s Law is what made Napster and peer-to-peer file sharing such a huge phenomenon. Bob told me, “Unlike Moore's Law

at a time, but liquidity nonetheless. Think Ebay or Instant Messaging, worthless with a handful of users, but unspeakably powerful platforms with millions of users. Metcalfe’s Law at work! The number of users matters, and trumps whatever capital a Wall Street firm could throw at the problem. *** While NASDAQ volumes rose with

Smart Mobs: The Next Social Revolution

by Howard Rheingold  · 24 Dec 2011

chapters, the driving factors of the mobile, context-sensitive, Internet-connected devices are Moore’s Law (computer chips gets cheaper as they grow more powerful), Metcalfe’s Law (the useful power of a network multiplies rapidly as the number of nodes in the network increases), and Reed’s Law (the power of a

the number of different human groups that can use the network increases). Moore’s Law drove the PC industry and the cultural changes that resulted, Metcalfe’s Law drove the deployment of the Internet, and Reed’s Law will drive the growth of the mobile and pervasive Net. The personal handheld device market

of computer-mediated social networks, however, four key mathematical laws of growth have been derived by four astute inquirers: Sarnoff’s Law, Moore’s Law, Metcalfe’s Law, and Reed’s Law. Each law is about how value is affected by technological leverage. Sarnoff’s Law emerged from the advent of radio and

Ethernet, a high-speed network that interconnected PCs in the same building.80 Metcalfe left PARC, founded 3Com, Inc., cashed out, and came up with Metcalfe’s Law, which describes the growth of value in networks. The math is simple and is based on a fundamental mathematical property of networks: The number of

in terms of group-forming networks (GFNs). I saw that the value of a GFN grows even faster—much, much faster—than the networks where Metcalfe’s Law holds true. Reed’s Law shows that the value of the network grows proportionately not to the square of the users, but exponentially.84 That

four under Met-calfe’s Law and Reed’s Law, but the value of ten nodes is one hundred (ten to the second power) under Metcalfe’s Law and 1,024 (two to the tenth power) under Reed’s Law—and the differential rates of growth climb the hockey stick curve from there

. As the Internet grew, much more of the usage and value of the Internet became focused on pairwise exchanges of email messages, files, etc., following Metcalfe’s Law. And as the Internet started to take off in the early ’90s, traffic started to be dominated by newsgroups, user-created mailing lists, special interest

that every user selects from. The sources compete for users based on the value of their content (published stories, published images, standardized consumer goods). Where Metcalfe’s Law dominates, transactions become central. The stuff that is traded in transactions (be it email or voice mail, money, securities, contracted services, or whatnot) is king

others who seek it. The thing that defines peer-to-peer, I think, is the degree to which the power of the technology depends on Metcalfe’s Law. In the end, a word processing program is only a word processing program whether you’re the only user or the millionth user; its utility

.com/wired/archive//6.11/metcalfe.html?person=bob_met-calfe&topic_set=wiredpeople > (27 January 2002). 81. David P. Reed, “That Sneaky Exponential: Beyond Metcalfe’s Law to the Power of Community Building,” originally appeared in Context Magazine, Spring 1999 (by permission of DiamondCluster International, Inc. © 1999) <http://www.contextmag.com/archives

-ome/> (25 January 2002). 2. Robert Wright, Nonzero: The Logic of Human Destiny (New York: Vintage, 2000). 3. David P. Reed, “That Sneaky Exponential: Beyond Metcalfe’s Law to the Power of Community Building,” Context Magazine, Spring 1999 (by permission of DiamondCluster International, Inc. © 1999) <http://www.contextmag.com/archives/199903/digitalstrategyreedslaw.asp

Running Money

by Andy Kessler  · 4 Jun 2007  · 323pp  · 92,135 words

six, etc. This turned into the scale of the Web when millions of nodes were connected, and Metcalfe’s Law is what made Napster and peer-to-peer file sharing such huge waterfalls. In fact, maybe Metcalfe’s Law is the formula for Doug Engelbart’s scaling of human knowledge, just as Watt’s steam engine

was about to break up on the rocks, the second derivative had played out, enticing investors in with the seduction of faster and faster growth. Metcalfe’s Law was no longer a secret; you could see it in subscriber growth and Internet usage and equipment sales and page views and everything. Fast growth

MCI, 61, 62, 72 Mead, Carver, 183 Meeker, Mary, 228 memory chips, 124, 126, 127, 154–55, 156 Metcalfe, Bob, 183, 188–91, 202, 290 Metcalfe’s Law, 190, 226 Mexican debt crisis, 164 Michelson, Albert, 190 microchips, 11, 46–47, 102–3, 129–35, 154–55 company sales, 208 development of, 124

The Secret War Between Downloading and Uploading: Tales of the Computer as Culture Machine

by Peter Lunenfeld  · 31 Mar 2011  · 239pp  · 56,531 words

the makers is frequently contradicted by the choices of the users, and as more users enter a network, Metcalfe’s law indicates that they will be affecting it geometrically. I would propose a corollary of Metcalfe’s law that applies to theories of technology as much as the original does to the technologies themselves. Metcalfe’s

The Seventh Sense: Power, Fortune, and Survival in the Age of Networks

by Joshua Cooper Ramo  · 16 May 2016  · 326pp  · 103,170 words

network of husbands and wives is immense—an insight that led Bob Metcalfe and his wife to start a networking company that made them billionaires. Metcalfe’s Law has another angle, and it’s here where some of the unique Macht of network gates is revealed: It’s not merely that the power

and services coming online—it will be even more costly. The network scientists Rahul Tongia and Ernest Wilson have called this “the flip side of Metcalfe’s Law.” To be excluded from a database of cancer genetics when it has a million members, for instance, is probably not such a painful problem; to

A: Mathematical, Physical, and Engineering Sciences 371, no. 1987 (March 2013). The network scientists: Rahul Tongia and Ernest J. Wilson III, “The Flip Side of Metcalfe’s Law: Multiple and Growing Costs of Network Exclusion,” International Journal of Communication 5 (2011): 665–81. fifty-one national enclosures: Ron E. Hassner and Jason Wittenberg

Here Comes Everybody: The Power of Organizing Without Organizations

by Clay Shirky  · 28 Feb 2008  · 313pp  · 95,077 words

as people adopt them. Robert Metcalfe, the inventor of the Ethernet networking protocol, gave his name to a law that describes this increase in value. Metcalfe’s Law is usually stated this way: “The value of the network grows with the square of its users.” When you double the size of the network

, there can also be four different sets of three-way conversations, or all four in one conversation. With ten people, there are forty-five pairs (Metcalfe’s Law), but a thousand possible subgroups (Reed’s Law). Reed’s Law also relies on the potential of communication; the vast majority of possible subgroups will

in Reed’s Law comes from the formation to human-scale groups—dozens, hundreds, sometimes thousands of people, rather than millions or billions. As with Metcalfe’s Law, the growth of the networked population increases the number of potential groups, but the value from Reed’s Law grows much faster than

Metcalfe’s Law, because there are many more potential groups than potential pairs. Metcalfe and Reed’s Laws conceive of value to individuals and to groups from all

also contains links at the bottom of the article to additional materials on the subject.) An alternate formulation of the same math is expressed as “Metcalfe’s law.” Robert Metcalfe, inventor of a core networking technology called Ethernet, proposed that “the value of a network rises with the square of its members,” which

is to say that when you double the size of a network, its value quadruples, because so many new links become possible. Metcalfe’s law isn’t true in any literal sense, because not all links are created equal—being able to contact your friends matters more than being able

exponentially with the number of people in the network,” which is to say that value grows even faster for groups than for pairs (as with Metcalfe’s law, described above). Paquet amended Reed’s law, adding “and in inverse proportion to the effort required to start a group.” In other words, the value

How to Be the Startup Hero: A Guide and Textbook for Entrepreneurs and Aspiring Entrepreneurs

by Tim Draper  · 18 Dec 2017  · 302pp  · 95,965 words

a network increase the power of the network as the square of the number of nodes on the network increases. This concept is known as Metcalfe’s Law, after entrepreneur, venture capitalist, educator and pundit Bob Metcalfe. The DVN allows me to evaluate and potentially fund any company from anywhere in the world

tell you? Is the price of Bitcoin related to the square of the number of wallets? Could this be an example of Metcalfe’s Law (see below for an explanation of Metcalfe’s Law)? Life Expectancy People continue to live longer lives. If the trend continues, what will the people of Earth look like in 100

with any currency), but as more people adopt Bitcoin as a way of transmitting funds, the more people recognize its value and its value rises. Metcalfe’s Law states that the value of a communications network is proportional to the square of the number of connected users of the system (n^2). The

value increases exponentially according to the number of nodes in the network. Metcalfe’s Law The math works this way: The value of the network (relationships) = sum of all numerals from 1 to N-1, where N is the number

value of the network. The second person adds only one relationship, but the 1000th person adds 999 relationships. Here is an interesting thought experiment. Apply Metcalfe’s Law to Bitcoin. If Bitcoin price is at $5000 today with 15 million people in the network, what will be the price of Bitcoin be when

of breakthroughs as computers become smarter and smarter. Each new generation can do more for us than the last one. Compounding Moore’s Law is Metcalfe’s Law that states a network becomes more powerful with the number of nodes on the network. And that has become more apparent as more of us

Clock of the Long Now

by Stewart Brand  · 1 Jan 1999  · 194pp  · 49,310 words

became obsolete every three years. The proliferation of personal computers and the digitizing of communications via the Internet set off what came to be called Metcalfe’s Law, named after Xerox engineer Bob Metcalfe. It states that the power of a network grows as the square of the number of users (people or

the people, a million times the value. What was the value of the Internet in 1998, when it had some 50 million people on it? Metcalfe’s Law explains why 50 million people had to get on the Internet in just a few years. The aggregate value of other users was so great

the online Holocaust-denying discussion groups in this fashion, connecting them to a linked distributed archive of documentation proving that the Holocaust indeed took place. Metcalfe’s Law of exponential growth of the Net is proving to be even more significant than Moore’s Law of exponential growth of microchip capability. The chip

Macro-myopia Malthus, Thomas Mao Tse-Tung March, James Maxxam May, Ernest Mayan codices, burning of McKenna, Regis McNeil, William McVay, Ken Melville, Herman Metadata Metcalfe’s Law Migration Millenium Millennial Clock. See Clock, Millennial Minsky, Marvin MIT’s Media Lab Moby Dick Moment on Earth, A Monasteries as maintainers of learning Monsanto

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