It was the best of times, it was the worst of times.
I think we’re living in the best of times, mind you, especially if you’re fortunate enough to be on this side of the digital divide. Sure, cars don’t fly - yet, but when you hop on a flight, you can make phone calls and surf the Web. I think that is my description of euphoria (well, the surf the Web part, I hope no one can make calls on a flight).
This week, Blognation called it quits. So did Edgeio. Blognation could not raise funding, Edgeio did and that was its undoing. there’s a common thread between the two, neither business was sustainable. Edgeio was taking on Craigslist, in essence, and neither Google nor eBay have managed to make much headway, the former via Base and the latter via Kijiti. Check spelling on that, please.
Heck, newspapers, once king of classifieds and listings don’t stand a chance against Craigslist, either, and they once owned the space. Mind you, newspapers are clearly on the wrong side of the digital divide.
As per Blognation, I think that is a testament of how web businesses work: start small, scale slowly, and succeed at your own pace. Blognation started big, with bloggers in many nations, and its costs were so far greater than its revenues, and the competitive landscape so fierce, that no investor sought a positive risk profile. Ultimately, Blognation failed to raise money.
Apparently, there are people interested in Blognation, but I wonder, why bother? After all, simply hire the writers and off you go. That’s precisely what one network did. If you think about it, few online companies will be able to justify the overhead of multiple writers until traffic picks up. But with every Tom, Dick and Harry having a blog these days, I wonder if it even makes sense for an online company to poke at the opportunity. In fact, every single company that makes a business by being a blog network (especialy Tech-oriented) was either started by an individual (Tech Crunch, Giga Om, ReadWriteWeb) or launched by a major media company with deep resources.
The only companies for whom it makes sense to make a run at Blognation, frankly, are magazines who make so much money offline that the aggregate salaries of writers scattered around the world would represent a low-cost international news wire. But, guess what, magazines (and newspapers) already have that set up… so why would they bother?
Therein lies the big fat irony of the Web, the companies that can afford to start most ventures that are akin to Blognation and Edgeio are the print companies, and let’s face it, most of these companies only accelerate their shrinking by embracing the Web.
What will 2008 present? I don’t know. But despite all of the talk of bubbles, I think that the Web is becoming more and more logical and pragmatic in determining what should be a business and what should not.
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