In 2013, the phrase “business model”—once an extremely popular phrase-paled in comparison to “social media.” An Internet search of “social media” produced more than ten times as many hits as one of “business models.” While such growth is interesting, a more important question for managers and anyone else who is interested in the profitability of businesses is: What is the impact of social media on business models? Our goal in this chapter is to explore this question. However, we start with an explanation of those characteristics of social media that are likely to have an impact on a business model.