Checking-In on the Internet’s Urban Density Problem

If you think about any of the most popular Internet start-ups that have appeared on the public radar within the past year, they all share one unique characteristic: they are more fun and engaging, the more people who use them within a specific geographic area. This goes for the geo-location services like Foursquare, as well as companies like Groupon (coupons for specific geographic locations), Instagram (photos tied to specific geographic locations), or Zaarly (financial markets tied to specific geographic locations). These companies typically launch in cities like New York, Chicago or San Francisco, build buzz at events like SXSW where large numbers of digital innovators gather – and then struggle to expand beyond the most densely populated urban areas. Does the Internet have an urban density problem?

In many ways, this urban density problem has been a consequence of the blurring of the line between mobile and the Internet. The more people who use smart phones, the more likely it is that they will use apps, and that means the more likely it is that geo-location enters the equation. If you open up most apps on your smart phone these days, one of the first questions you’ll be asked is, “May I use your location?” And this is not just for apps that are built around the Check-In. Take a picture with Instagram, and you’re asked a variant of this same queston. This is not an accident: geo-location has become a defining feature of any application that taps into your social network. It’s all part of creating the much-vaunted Network Effect — the very real observation that the value of a product or service grows more quickly and rapidly, the more people who use it.

The problem with geo-location, of course, is that it’s almost impossible to replicate this Network Effect across a broadly distributed geographic area. The world needs to be spiky, not flat, for geo-location to matter. For example, Read Write Web – one of the premier sites for tracking what’s new on the Internet – just last week opined that 2011 will be The Year That the Check-In Died:

“Early last year, “checking in” was the cool new craze. No visit to your favorite tech news site could be had without getting buried in an avalanche of articles about Foursquare, Gowalla, Loopt, BriteKite or a myriad other startups. The big guys quickly followed suit: Yelp introduced “Check-Ins” while Facebook launched “Places” and most recently, Google Latitude updated to incorporate check-ins and check-outs. But here’s the thing: the trends aren’t actually that good…”

Quite simply, checking-in is not that much fun if nobody you know is also checking-in. If you’re dining out in Greenwich Village in New York City, this may not be a problem. Most likely, you’ll be “rewarded” with something if you broadcast your location – a coupon from a nearby retailer, a notification that one of your Facebook friends is also at the restaurant, or a handy-dandy little tip about the GPS location where you happen to be standing. But what if you’re not in Greenwich Village, SoHo or midtown Manhattan?

Thinking about Internet in terms of population density reminds me of Edward Glaeser’s wonderful new book, Triumph of the City (you can read an excerpt from The Atlantic here). One of Glaeser’s fundamental theses is that the Skyscraper should become the fundamental building block for urban planners around the world. Skyscrapers are better at fostering social capital and creativity, given that so many people live stacked one on top of the other in such close proximity. Skyscrapers magnify humanity’s strengths in wonderful ways. And it’s not just true for the United States – the same is true for Mumbai or Shanghai.

In much the same way, the Internet needs Skyscrapers (metaphorically speaking, at least) now that geo-location has become such an important part of the way that we think about the Internet. If the first iteration of the Web was about making the Web more flat, then the next iteration of the Web is about making the Web more spiky. The more Skyscrapers a city has, the more “spiky” it is, and the more likely that the environment will be right for innovative, creative Web startups to emerge. For cities that don’t have or don’t want Skyscrapers, there is the very real threat that they will be left behind as the Internet continues to mutate and evolve in wonderful new ways.