Maybe once upon a time "First Mover Advantage" was important, that time I believe is long gone. Maybe it was important when building and shipping any product or service was extremely costly and time consuming. It was probably an important idea or theory for the Space Race in the 60s and 70s. I don't think it is all that important today.
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I think people should think more about the "Fast Mover Advantage" (I'm surprised there is no Wikipedia page on this today). The fast mover is able to counter all the hypothetical advantages associated with the first mover. Here is why:
First Mover gets to write the rules
True. They get to set the standards. At the beginning, these are the rules everybody gets to play with. However in a highly connected and digital world, the first mover needs to be fast. The market changes, and if the first mover isn't fast to realize that, the rules sadly only start to apply to the first mover; crippling them.
First Mover dominates distribution and scarce resources
Yes, if by distribution you mean trucks, trains and ships. This doesn't apply to the Internet. Its not scarce. Its open, its free, its a jungle, and there is no scarcity of customers. You can't conquer it, you can't beat it, you can only hope to own a niche in it; if you are fast enough. Online, your "distribution network" comes down to hitting that "publish" button to release your app, site, post, or tweet into the wild.
First Mover gets a head start on brand awareness
Yes, if you are building your brand on print, TV and radio. Building an online brand is a completely different beast. The Old Spice guy online commercials fed by questions on social networks like Twitter earlier this summer shows us that there is such a thing as "Fast Mover Advantage". For the first time in advertisement history, personalized ads were pumped out and broadcasted on Youtube over the course of a few weeks. It hasn't been done before and it wouldn't have been possible to do it if the agency wasn't allowed to be fast.
First Mover doesn't have to worry about switching costs and buyer loyalties
This is still a valid reason. Did Facebook have to invest tons of money to steal people from MySpace? Did Google from AltaVista? Did iPhone from Nokia? Switching costs still exist online and you would be dreaming to think you can steal users from Facebook. You can however, find a niche that compliments Facebook or targets a different audience all together. I think both the First Mover and the Fast Mover can have this advantage, even if the Fast Mover is late to the market. In Facebook's story, this didn't matter all that much. People joined the social network that their own friends were already on. Another example is Amazon.com. They weren't the first mover, unknowingly to many the first mover was books.com. Books.com today redirects to Barnes & Noble.
Stop worrying about being first, the benefits are hypothetical, and a lot of "firsts" are now out of business. Its the fast ones that are more fit to survive, and odds are you'll also eventually be first if you focus on being a fast mover.
Update August 29: Just found this this post on FastCompany He Who Moves First Finishes Last. This surprised me even more - its 10 years old. Why is "First Mover Advantage" still mentioned today?