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Metcalfe's law

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Metcalfe's law states that the usefulness, or utility, of a network equals approximately the square of the number of users of the system (n2). Since a user cannot connect to itself, the actual calculation is

n(n − 1), or n2n.

First formulated by Robert Metcalfe in regard to Ethernet, Metcalfe's law explains many of the network effects of communication technologies and networks such as the Internet and World Wide Web.

The law is often illustrated with the example of fax machines: A single fax machine is useless, but the value of every fax machine increases with the total number of fax machines in the network, because the total number of people with whom you may send and receive documents increases.

In March 2005, Andrew Odlyzko and Benjamin Tilly published a preliminary paper which concludes Metcalfe's law significantly overestimates the value of adding connections. The rule of thumb becomes: "the value of a network with n members is not n squared, but rather n times the logarithm of n." Their primary justification for this is the idea that not all potential connections in a network are equally valuable. For example, most people call their families a great deal more often than they call strangers in other countries, and so do not derive the full value n from the phone service.

External links

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