Design of Online and Offline Social Networks: Game theoretic modeling

Abstract

Social networks is more popular now than ever before: first thing we do in the morning is check facebook and during our whole day till midnight, we utilize (or should I say waste) our time on multiple social networks like chatting on facebook, sharing our images on Flickr, posting and following updates on twitter, viewing user-created video on YouTube, and watching peer-to-peer television using PPLive and PPStream. The interesting thing is how are these social networks similar to keep the users engaged and how are they different to keep their uniqueness. If you watch closely, you will find that within these social networks, users share, exchange, and compete for scarce resources and cooperate for mutual benefits and hence, at the end of the day, they influence each other's decision and performance. In addition, interestingly many corporates have even started using social networks as a critical part of their marketing strategy to increase the brand awareness and brand recall of their products. In the face of the challenge of the dynamics of change, the requirements and the expectations from a social network have changed drastically as compared to that of the earlier decade. Because users have many options available to switch, the design of social networks have a critical requirement to ensure that old users stick to the same social network and more and more users keep on joining this network, so as to bring-in more and more ‘guanxi’ and people can get benefitted from each other in this network. To give the basic guidelines on the design, it is very important to analyze the customers i.e. users' behaviors and their interactions with information and other users in the social network. Popularized by movies such as "A Beautiful Mind", game theory is the modeling of strategic interactions among rational as well as irrational agents. Since we need to study how should one design interactions between users so that each get an amazing user experience, Game Theory is ideal and essential for analyzing and modeling the users' behaviors in the social interactions’ scenario. The comprehensive study of various type of users’ behaviors proves that there are predominantly two dominant interactions – (a) cooperation (b) competition. In the competition behavior, users compete for the same resource, while for the cooperation behavior, they cooperate with each other for positive network effect. The findings of the paper are quite relevant, meaningful and motivating for new social networks who aspire to have many users and striving to give them a better network experience.