How Facebook Works
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Facebook is a wonderful example of the network effect, in which the value of a network to a user is exponentially proportional to the number of other users that network has. Facebook's power derives from what Jeff Rothschild, its vice president of technology, calls the "social graph"--the sum of the wildly various connections between the site's users and their friends; between people and events; between events and photos; between photos and people; and between a huge number of discrete objects linked by metadata describing them and their connections.
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