Commentary

A Repeat Of The Past?

In the beginning, there was the Web. Academics and the military used it for research and something called e-mail, and it was good.

Verily, some others got ahold of this Web more than 10 years later, and they realized its power as a medium of sorts. They built media models on it that were like previous media models, along the lines of magazines, catalogues, and newspapers, although more elegant and sophisticated in some ways, and far more rudimentary in others. Nevertheless, there was terrific power in this media, almost like all the trade and special-interest publications in the world in one place.

At one point, in late 1999, it seemed as though anything with a dotcom attached could attract millions of dollars in venture capital. In fact, some truly inane schemes that never made a dime in revenue drew millions of dollars from investors. Some spent or "lost" all this money. Others sit in the sun all day still, and it is good. It is especially good for them.

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Only a relative few of the businesses that these investors were putting their money in were viable, so many investors didn't get their money back, and much of the entire construct crumbled under the weight of their expectations.

But, the industry as a whole survived. In fact, once people focused on building actual value propositions and viable, revenue-producing media models, the industry as a whole thrived for years.

During perhaps five years of sustained growth from the mid-2000 crater, along came ad networks, geo-targeting, rich media, subscription models, Voice-Over IP, RSS, podcasting, adware, spyware, behavioral marketing, SEO, SEM, virtual communities...blogs...and a number of other elements and segments of our industry which all have one thing in common: each has been, at one time or another, the "next big thing" for interactive.

I put blogs by itself for a reason that may be obvious to you. The really hot segment within interactive today is user-generated content, of course. Blogs are a big part of that. Blogs fill a nice little sub-niche within online media, enabling micro-segmentation of audiences when accessed through interest sets or via an author's byline. Mostly, however, what blogs do is enable a unique kind of public relations to take place within organic search.

Well-executed blogs make for an ongoing endorsement channel for products, services, opinions, rumor, and more. Sure, blogs do more than this. When aggregated, they can even be built into enough critical mass to be meaningful media assets. But, in terms of media on the whole--as a monetizable media asset anyway--blogs are not really on the map yet. In fact, an apt comparison of blogs could be made with early Web sites that were built to be like other media, only more rudimentary. Only, in the case of blogs, the media being replicated is, of course, Web sites themselves.

So, why the long buildup to this payoff? Sorry, guys--yesterday's news of Weblogs Inc.'s sale to AOL for $20M-$25M (depending on your source) seals it for me. Recent purchases and industry contractions have me fearing that we're getting back to late 1999 all over again, with the only difference being that today's companies actually make money.

Since that remains the case, I'm not worried about any kind of bubble-ish fallout from these deals. So, this is no Chicken Little polemic. I do fear, however, that the cycle so many of us endured before will repeat itself somehow--perhaps (one hopes) in a much shallower fashion. Could the present infatuation with user- generated content (especially blogs) signal a turn in this cycle? I hope not, but I fear so.

Tell me why I'm wrong on the Spin Board. I'm all ears.

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