So far, I have explained various characteristics of network effects and their impact on scalability, defensibility, liquidity, and monetization. The implicit assumption here is that interactions between participants are positive for everyone involved. This is true most of the time, but not all of the time. Interactions between network participants can also be negative. As a result, successful networks need to put curation mechanisms in place to encourage positive interactions; and dissuade or prevent negative ones. Let’s take a deeper look at what these negative network effects look like and the curation mechanisms to mitigate their impact.
