Blog networks pounding at traditional media and news web sites

Now VCs are continuing to open their pockets to blog networks– GigaOm, PaidContent, B5 Media (founder presenting at our Plexus 2007) and PayPerPost (see yesterday’s post below). Years ago any content was perjoratively referred to as vapor! Well, vapor has condensed into a real threat to old and web news media. And these blogs can truly be monetized because the myopia of advertisers is now lifting toward 20/20 vision. No more vapor. No more bubble. Sequoia Capital of Silicon Valley fame plunked down $5mm on blog network Sugar Publishing. It’s most popular blog is PopSugar. In fact, it is rumored that this network born in Fall 2005 from scratch is in the $12-15 million range, probably more. Watch that valuation fly upward. Why? Because it caters to a large consumer audience, young, hip women. Sugar includes a number of blogs and sites catering to the same audience. Sugar reports 3 million unique visitors and 20+ million page views per month (up from 13 million monthly page views and 1.5 million unique visitors only a couple of months ago!). Sugar aims to launch four new blogs on the heels of this deal including GeekSugar (about gadgets), GiggleSugar (just fun), BuzzSugar (audio, video, reviews) and YumSugar (food and drink). I have a feeling the recent deals are going to trigger an onslaught of niche networks. For advertisers this development arrives not a moment too soon. Boy oh Boy! the landscape is changing.

Consumer blog adverts: The “long tail” gets longer

The world’s first and new consumer generated advertising network, PayPerPost reported in August 2006 that it has signed up over 500 online advertisers in its first five weeks of operation. In fact one 30 year old mother of three pulled in $1,000 in seven weeks. Essentially, the blogger posts about products (with approval by PayPerPost). I don’t know yet if that includes vitriol or if it is all sugar and spice i.e. moderated beyond the spirit of the blog. The company, will have to be careful about authenticity in these blogs–allow rants and the blogger to meander aimlessly.  Seems they do. Otherwise, the blogger will lose the readership and street cred. Great care is needed here. The company just raised $3 million in VC money. Now they can afford to demo at our big Web 2.0 Conference and Demoplex, Plexus 2007, (ya it’s a plug–but this post is all about that) . CEO of PayPerPost, Ted Murphy says, “In the past, online advertising was all about leveraging big media buys with repetitive advertisements and messaging created by a company. We have successfully demonstrated to our online advertisers that smaller investments in unique, consumer generated advertising can provide far greater value.” Rings true. One advertiser, Teri Fritts, founder of AliceAccents.com waxes about PPP, “I love the way that individual bloggers actually review my products and post their own opinions online with relevant keyword text hyperlinks to my product pages. PayPerPost.com advertising, either positive or negative, is far more valuable than an anonymous hyperlink to my store with little or no explanation.” Small and mid-sized businesses are the smart advertisers here –but it won’t be long before PPP becomes mainstream.

Web behemoths on feeding frenzy

Google is rumored to be courting YouTube (not yet profitable but it does broadcast a reported 100 million videos each day) for $1.6 billion as we speak. No doubt this will be its biggest acquisition yet. But don’t reach for the Rolaids yet because Rupert Murdoch, Yahoo, Viacom and Microsoft, also have their eyes on YouTube. By all accounts, Google seems ahead of the race. Until 2006 Google was on a steady diet of smaller start-ups that provide turn-key features to Google’s various tools. But the YouTube ten-course meal is a good one. For Google who has had some difficulty with building communities via video sharing, YouTube will prove useful. And for YouTube, tormented by claims of intellectual property, Google could be its salvation. It will be interesting to see how Google integrates this complex platform and content into its own, never mind the difficulties of merging itself. Google’s steady diet could slow its innovation especially when we hear Sergey Brin repeatedly admonishing his organization to not develop any new products but rather, improve on the products they have. This in the same year staff functioned within a culture of innovation, where 20% of their salaried time was freed to start something new. Slowing innovation… True to the nature of a corporate behemoth.

Yahoo’s appetite is no less sizeable as it negotiates to buy Facebook, a social networking site, for over $1 billion. The feasting has undoubtedly been fueled by Rupert Murdoch’s acquisition of MySpace (a rivalling social network of sorts to Facebook) for $580 million. It is now valued at $2 billion.The conglomerates want to buy before this type of valuation escalation uhh… escalates! Gosh this sounds more and more like the bubble of the recent past: sky-high valuations on unmonetized properties. For social networks only advertising will provide revenue and unlike the bubble there is now a keen and mature interest by advertisers since audiences (especially youngs ones) have grown up on new media and are virtually absent in traditional media ratings. I just can’t understand why traditional media are never at the bargaining table. It will be their undoing. Is Rupert Murdoch the only player with neurons firing?

Wibree: The tiny wireless standard that will grow

Wibree, Nokia’s radio technology consumes so little energy that it makes it affordable to build and market small wired devices. Think wireless watches, jewelry and toys. It’s not a competitor to Bluetooth because in fact they can be a dual core chip. But it is a stand alone technology for the smallest of devices. For inventors this will produce a boon of new devices. Nokia states, “it is an open industry initiative extending local connectivity to small devices”.

It has my imagination going, wireless sunglasses, wireless earrings…. hmmmm. Very James Bond. It’s getting more del.icio.us every day.

Voice over interactive paint

A fun parody on VOIP (another use for the acronym). When technology enables interactivity without touch. Talk about user generated content. Have some fun with art. This is why YouTube has great value and a huge following.