plus/minus epsilon

Alternate Title: Cloudflare’s Plan for World Domination (Not Really (Maybe))

Cloudflare’s browser product will mark the beginning of a two-sided network. That is, we’ll have answers to the two following questions:

Why would more users of Cloudflare’s browser make a website want to join Cloudflare? Because this would give them access to very accurate information about the types of users on their website. For example, whether or not someone is a bot (security), or if the device being used is compatible with company policy (compliance). Highly-accurate and detailed analytics of almost any type could be collected.

Why would more websites on Cloudflare make a user want to use Cloudflare’s browser? Cloudflare claims that a remote browser is already slightly faster and more bandwidth-efficient than a normal browser, but if a website is also built on Cloudflare’s platform (using Railgun, Argo, cache, Workers), that would make it extraordinarily fast to render because everything could be computed locally, and would possibly make new online experiences possible.

The important point is that, while one-sided network effects make it difficult for newcomers to directly compete against incumbents (hence the importance of disruptive innovation), they don’t necessarily help incumbents compete against each other. Two-sided network effects on the other hand, favor winner-take-all outcomes, especially in something like the browser market where people have a strong preference to only use one browser.

(NOTE: This is speculation based on public information.)