July 18, 2005

One Server Companies

Jim Moore, explaining why he's got a venture fund that concentrates on RSS, draws an interesting portrait of an emerging ecosystem. Outlining some broad categories of ecological niches (diurnal scavengers, large carnivores), he identifies an interesting one:

Small, 'one server' companies are becoming essential services:  Bloggdigger, del.icio.us, weblogs.com.

I'd always thought that one-server was merely a stepping stone or an affliction. Looking back, when Blogger turned into a machine in a borrowed closet with a quarter of a million customers and no revenue, that was just an anomaly. Blogger needed to be bigger than that, and when it got the cash to be bigger, it got better.

But some valuable services belong at the one-server scale. Weblogs.com is a terrific B-to-B service. It wouldn't be better if it did more: it just does enough.

Also relevant is Peter Merholz's talk, yesterday, about Designing for the Sandbox. Back in the old days, Web organizations like Yahoo and AltaVista cluttered up their page (and their business) by adding more and more, vainly trying to get people to stick. Meanwhile, Google just did one thing, and communicated that focus by remaining, in essence, a single box on a single page.

At the same time, people used to prophecy the doom of Amazon when they branched out from books. But selling other stuff wasn't a diversion, because books weren't Amazon's business. Amazon was built to retail lots of SKUs: when you're a bookseller, you need to have a lot of different books to sell because everyone wants something different.