Going from killer app to major Web platform

Applications that evolve into open platforms--and successful online businesses--are the wave of the future, execs say.
Written by Elinor Mills, Contributor
What do Facebook, Second Life, Google and Salesforce.com have in common?

They all started out as applications that evolved into Web platforms, enabling developers to create more compatible programs and companies to build businesses off the platform ecosystem. This is the wave of the future, company executives said in a panel on Thursday at Fortune magazine's first iMeme: Thinkers of Tech conference, an event striving so hard for chicness that it opened with a lesson on how to operate the Herman Miller Aeron chairs filling the room at the Ritz-Carlton hotel in San Francisco.

"The Internet is the new operating system. The killer apps of the Internet are becoming platforms that are creating communities of innovation," said Marc Benioff, chief executive of customer-relationship management specialist Salesforce.com. "This is a whole new chapter in our industry."

"The power of the platform is it makes your core offering more valuable," he said. Platforms are able to extend into new markets by being open to outside developers, he said. For instance, application development that Thomson Financial and Dow Jones did on Salesforce.com suddenly made his company "a huge player in the financial services market," he said.

"We replaced (business-software provider) Siebel (Systems); they never made the leap from killer app to platform," Benioff said. "If you don't make that leap, you don't become a major player like an SAP or an Oracle."

When apps flooded Facebook
Sitting next to dot-com veteran Benioff, whose company offers hosted business software as a service over the Internet, was 23-year-old Mark Zuckerberg, who started the popular Facebook social-networking site in his college dorm room less than four years ago. Facebook's move to open the site up to outside developers and to allow anyone, not just college students, to use the site has led to a surge in membership registrations.

"The most natural way for people to communicate and the most efficient was through" friends and acquaintances online, said Zuckerberg. "To us, opening up the platform was just the next step in developing this theory."

"We're going to give you all the same tools that we give ourselves; treat your apps the same as ours," he added.

That move quickly paid off. Thousands of applications have been released for Facebook since late May when the company opened up the platform. "It has certainly grown a bit faster than we had originally expected. We thought there would be a lead time," he said. "That whole process got condensed to about a week."

Within one week the first new application had a million users, while more than half of the users have added an application to their Facebook page, Zuckerberg said.

"We're going to be constantly pushing the envelope," he said. "There is still a lot of stuff we need to do with developers, a lot more controls we can give to people."

Marissa Mayer, vice president of search products and user experience at Google, said she agreed with Zuckerberg that platforms often happen naturally in technology companies. That was the case at the search engine, which offers advertising systems that enable anyone with a Web site to make money off that site. And Google distributes gadgets--third-party applications that people can put on their Google home page and other sites, she said. Google also has made it easy for developers to create mashups and overlay other data on top of it. For example, Google has released Google Gears, a browser-side plug-in that makes it easier for people to develop Ajax applications that can run offline.

But Google may even go further than just releasing developer tools, according to Mayer.

"We just have so many ideas that we can't implement...so it makes sense to open it up. The coup de grace would be letting people build on our platform, on our servers," she said. That idea is complicated and thus "something we're interested in, but we haven't made many advances on" it, she added.

Philip Rosedale, chief executive of Linden Labs, which produced the Second Life virtual reality environment, said Second Life and Facebook are popular because they give people a new environment to interact in that they are comfortable with.

"It seems that a lot of the platforms out there allow us to do things we can already do in the real world...and let us do them extremely fast."

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