As much as I am excited about new developments in the world of the interweb; flickr, youtube, digg, delicious…etc. I can’t but help think that the rush towards web 2.0 gold might have a touch of the March 2000s about it. Sure these services are really good and there is definately a tidal shift occurring in how we interact with the internet, but myspace worth gazillions? del.icio.us worth $15-20 million? I know markets just lurv growth rates and tend to dislike guaranteed sales within a narrow profit margin, but everyone made this mistake 6 years ago.
Yes, 25 people can run a company that has millions of users, and yes they can be loved and regarded as brilliant. But when you have 35,000 videos being uploaded a day with very little money incoming (apart from VC cash) then surely there is only so long this can last? Ah yes, advertising, that’ll save us. But why is this always seen as the golden child? If in doubt, google ads, but when do most net savvy users actually click on them? I am all for hyper targeted advertising, but probably will trust a blogger’s recommendation, than the ads placed on their site.
As you can see, it’s not that easy to get on a growth path and keep going. As for those spikes? Well, that’s just us (the technophiles) screwing around and playing with this stuff.
From: Reality Check 2.0
Maybe I am being a bit ‘bah humbug’ about this all, but I just can’t see how these companies are supposed to make any profit beyond covering the costs of hosting.
Don’t get me wrong, I think we are really in a web renaissance at the moment and are on the verge of seeing the web operating at its much hyped potential. Many of the new services have made my web experience much richer, but would I pay for them? Would I accept massively intrusive banner ads? Generally I see the system working on a socially beneficial level and on a much more micro level, not a monetary behemoth one. The moment people feel a service has been compromised by over-advertising, overly harsh controls or simply overuse, then a clone will pop up somewhere else (facebook, magnolia, google video) and the process will start all over again. I suppose my main beef with the way web 2.0 is going, is the hijacking by greedy corporates looking to make a quick buck.
I suppose that’s the nature of the beast, where there is genuine excitment and inovation, there will be dollar signs flashing in people’s eyes.