No, the chicken and egg problem is not what is wrong with this one. I was one of those excited about open social pre-release but it's release was riddled with all kinds of problems[1]. If google had gotten it right at the start, it could have really taken off. If google can still get it right and demonstrate cleanly how one can make a secure open social based site, it still has a very good chance of taking off. It's a good idea but I am not so sure about this particular implementation and it's details. Google or somebody probably should do an OpenSocial 2.
[1] http://en.wikipedia.org/wiki/OpenSocial#Criticism