Comparing The World and Facebook
Discovery Channel was showing a documentary on The World, another magnificent paradise project designed by Nakheel and endorsed by Sheikh Mohammed bin Rashid Al Maktoum. The World is a set of man-made islands that are shaped and positioned to resemble the lands and waters of the earth. The project follows the steps of the Palm Islands. What an amazing piece of work.
An island can be yours for a measly $25M (on average). On this island, you can build what you want — build a personal retreat, a travel destination resort, an exotic zoo, an exact replica of the country an island resembles. The islands that range from six to twenty acres — even at the low end, that’s a big island! There are predefined rules for acquisition, construction, commerce, and occupancy, but the opportunities seem endless. For example, fourteen islands that make up Australia and New Zealand are being reformed to create nineteen islands for a special resort.
Nakhell, the company behind the development, announced recently that it would build a resort on the “north coast of Canada” (below). This spans almost eight square miles “consisting of three main elements including a marina village, a specialist spa hotel, and a residential development.” Keep in mind, this is a man-made island.
So what’s the point, and why am I comparing The World to Facebook? Isn’t it clear?
Simply put, Nakheel has built a foundation of The World and is giving others control to build commerce upon it. By participating directly in development and commerce, Nakheel provides best practices to other developers and investors. It also is able to derive an applied knowledge from participating directly on the islands it has built. Of course, Nakheel also provides infrastructure support such as transportation.
It should seem clear. Facebook launched its F8 platform upon which others can build commerce. It provides the infrastructure, resources, and guidelines. Facebook participates directly in commerce with its marketplace and advertising. When it launched its open platform it worked directly with major companies to launch applications and I wonder if they have negotiated revenue sharing models with them (e.g., Amazon, Lending Club, etc). Just as The World has attracted major real estate investors and developers including Trump, venture capitalists have chosen to invest in Facebook application developers. Even more interesting are the companies that provide marketing, distribution, and additional infrastructure, such as Social Media, a company co-founded by Seth Goldstein. This reminds me of my post on SecondLife.
The part that has yet to be understood is how Facebook will directly capitalize on the applications being launched on its platform. Nakheel is able to sell physical land in addition to charging tariffs on commerce, and it has been stated that Facebook may begin to tax FBML queries. This would seem inevitable and I would expect much more.
Albeit an abstract comparison, it’s amazing to see how all channels of commerce share similar principles and structure.
