Internet & Interactive Media covers search, social, messaging, online communities, listings and dating platforms. MoatScope covers 66 companies here. Two have a wide moat, 14 a narrow moat and 50 none. The industry's economics are highly concentrated: a handful of platforms own most of the attention and most of the advertising that comes with it.
How the industry makes money
Most revenue comes from advertising sold against user attention. Alphabet sells targeted advertising to millions of businesses and also earns from cloud services and a portfolio of consumer products such as Android, Chrome, Maps and Gmail. Meta runs the largest family of social and messaging apps, Facebook, Instagram, WhatsApp and Messenger, and earns almost all of its revenue from advertising. Smaller platforms add subscriptions, as dating apps do, or listing fees, as car and property marketplaces do.
Where the moats are
Network effects and intangible assets such as data, brands and ranking systems each appear in 13 of the 16 moat-rated companies. A platform becomes more useful as more people use it, and more people bring more data and more advertisers.
- Alphabet: network effects in search and its consumer services, intangible assets in data and technology, and a cost advantage from running infrastructure at enormous scale.
- Meta: network effects across billions of daily users and the advertising tools built on that audience.
Narrow-moat companies such as Reddit, Pinterest, Match, CarGurus, Autohome, Baidu and Grindr have networks that are valuable but smaller or easier to challenge. Most companies without a moat, Snap among them, compete for attention that can move to the next app or format.
What wears moats down
User attention shifts with each new format, and a platform that loses engagement loses advertisers soon after. Privacy rules and changes to mobile operating systems can limit ad targeting, antitrust action can constrain the largest platforms, and new ways of finding information can pull activity away from established services.
What the quality scores say
Alphabet and Meta score 89 and 90 on MoatScope's quality scale, against an industry average of 34.
What to watch
- Engagement and time spent across platforms.
- Advertising pricing and the reach of ad targeting under privacy rules.
- Antitrust cases and remedies affecting the largest platforms.
- Changes in how people search for and discover information.
Moat ratings and quality scores on this page update as companies report. Price versus fair value for every company in the industry is in the screener.