Myspace

Myspace's decline from $580 million (2005) to $35 million sale (2011) exemplifies how network effects can reverse. In 2006, Myspace was the world's most-visited website. Facebook's cleaner interface and real-identity architecture attracted users away. Once the network effect reversed, Myspace entered a death spiral - fewer users meant less reason to stay. News Corporation's ownership prioritized advertising over user experience, accelerating the exodus. Myspace demonstrated that network effects protect incumbents until they don't.