So I was asked by an analyst to put into words something that I've been espousing for sometime in presentations and panels for sometime about this topic. So I thought I might as well throw it up here as well:My fundamental thinking as it related to "social-commerce" and the "viral economy" as it relates to the Suppliers/Distribution in Porter Five Forces model is this:
We have moved from physical goods to digital goods, from physical delivery to digital delivery. Whats MOST interesting about whats happening now is the disruption in discovery and distribution of information and services, esp. in online entertainment and games. The same disruption that happened to physical entertainment to digital delivery (i.e. CDs to iTunes, DVDs to Netflix) is happening to digital distribution. We are no longer reliant on going to a "portal" -- in essence a "trusted aggregator" of digital goods and services to find and discovery quality games and entertainment that we once did with portals like Yahoo Games, because of the proliferation of social networks and virality, people discover and adopt more and more games because of invitations and notifications from friends. Distribution is now baked into the game mechanic, in essence, your distribution channel effectiveness and scale is correlated to how well you are able to acquire customers -- and in turn amplify their voices though systematic viral engineering to spread your services/goods across the network.