While I do believe there are genuine cases where a new company does have a 'competitive advantage' most do not. At the end of the day the only advantage a company should strive for is how to use their skill, resources and relationships to make more money than their competitors. MySpace was on a great growth path before a lot of people even knew what Facebook even was. They had more financial resources sooner than Facebook and had a lot of ‘cool’ corporate sponsors to provide brand equity before Facebook. At the end of the day what they did just felt better to more and more users and what MySpace didn't do made it an easy case to switch. It is not that MySpace could not replicate the features of Facebook it was the fact MySpace didn't.