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A Brief History of Virtual Communities

The first virtual communities emerged about a decade after the establishment of the Internet. Starting in the early 1980s, a network called USENET was set up to link university computing centers that used the UNIX operating system. One function of USENET was to distribute "news" on various topics throughout the network. Participants were able to set up their own "newsgroups" on topics of shared interest. These were bulletin board type discussions where participants could send messages to a newsgroup on a given topic and read the messages sent by others.

Initially, all of the newsgroups focused on technical or scholarly subjects, but so-called "alt" and "rec" groups that focused on non-technical topics such as food, drugs, and music began to appear. Before long, the number of news-groups started to grow exponentially. From 158 newsgroups in 1984, the number grew to 1,732 groups in 1991 and to 10,696 groups in 1994. Today there are more than 25,000 different newsgroups in existence.

Newsgroups initially developed in the non-commercial environment of the Internet. But commercial services began to take note of and exploit the trend. CompuServe hosted a number of "forums" that allowed people to share professional and personal interests. The popularity of these forums played an important role in the growth of CompuServe throughout the 1980s. The Well, based in the San Francisco Bay Area, flourished as a place where online pioneers could gather to meet and talk with one another.

In the early 1990s, America Online (AOL) was establishing itself as an easy-to-use service for a mass audience. While it provided news and reference information and other kinds of services, AOL emphasized the value of person-to-person communication and the benefits of participating in virtual communities. In fact, AOL provided a home for many popular online communities such as the Motley Fool, which served individual investors (and which was one of AOL’s biggest early successes); NetNoir, which focuses on Afrocentric culture; Blackberry Creek, which is designed to appeal to pre-teenagers; and SeniorNet which was intended for older adults. In fact, AOL’s emphasis on community-building was one of the factors that helped it to reach its dominant position among online services.

The publication of The Virtual Community by Howard Rheingold in 1993 introduced the concept to a broader audience. The book’s author was writing not merely as an observer of the phenomenon but as a participant.. Rheingold was an active member of The Well and much of the book was based on his experiences there. He was one of the first to assert that online networks were emerging as an important social force that could provide rich and authentic community experiences.

The concept of virtual communities received greater attention with the 1997 publication of the book Net Gain by John Hagel III and Arthur G. Armstrong. The work gained credibility from the authors’ affiliation with the well-known consulting firm of McKinsey & Company and the fact that the book’s publisher was the Harvard Business School Press. Hagel and Armstrong acknowledged Rheingold’s work, but extended it by arguing that virtual communities have economic as well as social significance. Like Rheingold, they recognize that virtual communities are based on the affinity among their participants that encourages them to participate in ongoing dialog with each other. Interchanges between participants helps to generate "webs of personal communication" that reinforce the sense of identification with the community.

The authors then go on to explain how virtual communities can create value by creating linkages between community members and companies interested in reaching them. At the simplest level, virtual communities can attract vendors who have products or services to sell that are relevant to community members (e.g., airlines in a travel-oriented community, or diapers in a community of new parents). From this perspective, virtual communities are similar to special interest magazines that attract advertisers who want to target a specific market segment.

But virtual communities do more: they can allow community members to interact with vendors to express their preferences or provide feedback on a particular product. And because they communicate with one another, community members can band together to share information and seek additional benefits, such as discounts, from vendors. Because of these aspects, virtual communities have the potential to transform and expand the relationship between vendors and their customers. In fact, companies have an opportunity become participants in virtual communities, not merely sponsors or vendors to them.

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