Venture Capital: Snapvine turns up the volume a notch
WHAT DO 50 CENT, Enrique Iglesias and Vanessa Hudgens have in common? They are among the millions of people using an online voice player from Seattle's Snapvine, a service that allows them to add and receive voice messages directly on their MySpace pages.
Context & Ripple Effects
The venture roundup item lands at an awkward moment for Snapvine's host platform. Celebrity adoption — 50 Cent, Enrique Iglesias and Vanessa Hudgens among millions using the voice player on their MySpace pages, per the paper's sourcing — gives the Seattle startup organic reach, but it arrives just as MySpace's dominance shows cracks: reporting days earlier put its page views down nearly 20%.
That tension defines the story: Snapvine is a third-party widget whose entire distribution surface is someone else's traffic. MySpace co-founder Chris DeWolfe has reportedly floated opening the network so outside companies can plug web services directly into it — unconfirmed — which would formalize exactly the embed relationship Snapvine depends on informally.
First-order effects
- Snapvine gets a marketing windfall: celebrity voice messages function as free endorsements across the MySpace pages of users with large followings.
Second-order effects
- If MySpace's page-view erosion continues, every widget built on it inherits a shrinking host — Snapvine's growth ceiling is set by MySpace's traffic trajectory, not its own product.
- A formal open-platform move by MySpace would force widget makers like Snapvine to compete inside an official ecosystem rather than piggybacking on embed code.
Third-order effects
- Social networking is stratifying into host platforms and a third-party application layer riding on top, where startups' fortunes are hostage to the platform's audience shifts — the dynamic that pushed News Corporation's property toward video upgrades, ad targeting and reported platform openness through 2007.
The trend: Third-party widgets are becoming the growth engine of social networks, transferring leverage from platform owners like MySpace to the app developers whose features their members embed.