• CNET News.com, Thursday, August 16, 2007 11 AM

Traditional media firms have gone Web hunting again. In the past month, Hearst purchased the social shopping site Kaboodle and The New York Times Co. reeled in bookmarking startup Clipmarks and the Freakonomics blog. Earlier in the year, Discovery Communications bought the eco-blog TreeHugger, and CBS Interactive added Last.fm and the finance video blog Wallstrip.

Indeed, to his surprise, Manish Chandra, the founder of Kaboodle, said, "We were in discussions with multiple media companies and not really that much with tech companies for some reason." Does that mean Chandra doesn't have faith in his site's new owners? Hearst, after all, is a traditional print publishing company.

Media companies are forking over tens of millions to hundreds of millions of dollars for companies that would be more appropriate for a Google or Yahoo. The result: déjà vu and skepticism among Web critics and financial analysts. Blogger Alan Mutter says, a former newspaper editor and current partner in the VC Tapit Partners, says "[traditional media co.'s] don't understand how Web publishing works." A couple of cases-in-point: NBC Universal's way overpriced $600 million purchase of iVillage in 2006, or Conde Nast's bizarre buy of Digg competitor Reddit earlier in the year. Digg, incidentally, continues to trounce its competition.

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