Network effects without pricing power are mirages

Helmer distinguishes between "network effects" (any network benefit) and "network economies" (network effects strong enough to create material competitive advantage).

For me the difference is materiality is that whether the value benefit is large enough to engender a price delta significant enough to give you materially different margins into the future.

Network effects occur when a product becomes more valuable as more people use it, while network economies are network effects large enough to create significant pricing power and competitive advantage.

I think that Uber and Lyft probably have network effects involved but not network economies.

When consumption-based business models started, I think you saw go-to-market shift into being meaningfully more consultative because often that first land was the very beginning of the journey and represented a very small percent of what you were ultimately going to do with that customer.