MappingTheWeb //

Once again, Facebook rumours are all the talk in the blogosphere. The newest gossip, courtesy of the Wall Street Journal, states that Microsoft is in talks to buy a 5% stake in Facebook for a reported $300-500 million. But the plot thickens… The article goes on to say that Google may also be interested in buying a stake of its own, further upping the ante.

Surprisingly, we’re not hearing about any full-blown acquisition rumours anymore. Why not? No-one can afford the damn company anymore. Apparently, Microsoft is pegging the social network at a current valuation of $10 billion. Are you kidding me? The company is only slated to pull in $150 million in revenues this year. Now, I’m not a financial analyst, but I can tell you that such an amount is rather ridiculous based on historical valuation methods. Furthermore, previous acquisition talks this year started at $1 billion and escalated to a seemingly preposturous $6 billion.

And get this… Facebook may be turning down the high profile deal in hopes of attaining a $15 billion valuation. Yes, you heard me right. The bubble may be closer than we think. Either that or Zuckerberg’s ego has ballooned to Donald Trump-like proportions.

When MyBlogLog launched in late 2006, it caught fire. Many of the big tech blogs immediately jumped on board and started using the service. This fueled massive PR and popularity shot to unprecendented heights. Soon, all the big tech blogs were taking advantage of the service. Then, only a couple of months later, Yahoo buys the company for $10 million. Since then, very little has changed and not much has been said about the company.

This simple, yet ingenious idea sparked for one reason: it provided value for both the blogger and the reader. The blogger was provided with a tool that encouraged repeat visitor loyalty, while the reader gained awareness and exposure (via the displayed avatar) in return.

After the Yahoo acquisition, the success and appeal of the service seemed to die off. To some degree, it became overrun with spam. Some were adding as many contacts as possible to market their blog, while others advertised via their personalized avatar. This was predictable. As is the case with Digg, any social media property that vaults to fame and attracts a large user base becomes susceptible to cheating and gaming.

Nevertheless, I am itching to know when the company will make some sort of announcement or launch a new version. Furthermore, how Yahoo plans to integrate the service is even more of a mystery. I assume this will become more clear in the days ahead with the transition strategy now in full-tilt.

How do you think MyBlogLog should proceed? How should Yahoo integrate the service?

Well… not quite. But I’m surprised that we haven’t heard more such rumours. Facebook seems to be hogging the attention as of late. Nevertheless, I expect Twitter rumours to surface fairly soon.

Though the service hasn’t reached the mainstream yet, I doubt it will take long before it does. Already, many social networks have integrated similar status update services. As we all know, the micro-blogging space is on fire right now. Phenomenal growth has been witnessed. Having said that, don’t expect it to die off any time soon. Micro-blogging isn’t a fad or a trend. It is a platform - and it is here to stay. Other well-known names in the space to watch include the likes of Pownce, Jaiku, and Tumblr.

So why is Twitter the big name? After all, the technology isn’t very hard to copy. It is actually quite simple when compared to numerous other apps out there. Twitter is the known name in the space. All the innovators and influencers use the service. Any potential acquisitor would (obviously) be more interested in the user base rather than the actual technology.

Speaking of potential acquisitors, some names that come to mind include:

• Google (potential integration with Blogger)
• Yahoo
• Six Apart
• Any social network - though most have implemented their own status function, the user base is the key incentive.

Do you think Twitter will get bought any time soon? If so, by who?

As Mark Evans points out in a recent post, there is a Facebook application “gold rush” taking place right now. Everyone and their dog is scrambling to launch an app to capitalize on this fad opportunity. Many are seeing astonishing growth - from zero to tens of thousands of users in a mere couple days. But is this truly sustainable? Even more importantly, is it really worth it? I don’t think so. But don’t tell that to Facebook or the application creators.

Anything that vaults to stratospheric popularity levels in a short period of time is bound to see a fall-out or backlash of some kind eventually. In this case, the novelty of apps will eventually wear off. Some may disagree, but I would wager that ’superpoking’ and ‘throwing food’ are only cool for so long. Frankly, I’m already tired of all these ridiculous app invites after only a couple months.

The promise of monetization or a sale is what is driving this boom. But let’s be honest here - how many will actually profit from a sale or achieve reasonable revenues? My guess is under 1%. In other words, Facebook is almost creating a false sense of hope for developers. Subsequently, facebook profits from additional PR, user growth, and developer evangelism.

To me, Facebook applications are no more than a marketing funnel to an outside web presence. If you plan on making the app the entire business, you are walking a dangerously fine line. Forever more, you will be at the mercy of Facebook. If they decide to change course, you could be screwed.

My intuition tells me that the introduction of the developer platform was simply a move by the company to create short terms success and fuel PR ahead of an IPO or potential sale. Let’s analyze this further:

1. Facebook launches the developer platform.
2. Developers experience exponential growth and boast about their success.
3. The press takes notice; widespread PR ensues.
4. More developers jump on the bandwagon.
5. A positive feedback loop is created: success feeds PR, which fuels further applications. Repeat.
6. Eventually, a bubble is created as the app market is saturated and over-crowded. The dilution leads to a fall-out.

In other words, I believe that the developer platform is a short term ’stunt’ to raise awareness and exposure for the company. Over the long term, I see the move as being more detrimental than beneficial. I, for one, am already starting to get disgruntled by the addition of clutter and useless knick-knacks. The Facebook crowd, for the most part, is an older group. Such silly applications should be left for the MySpace or hi5 crowd. They degrade the quality of the experience. A seeming endless amount of scrolling is now needed to browse most profile pages. Is this the Facebook that we all remember?

Note: I refuse to make any parallels to MySpace or Geocities just yet…

I’ve been pondering the following question for quite some time and I’d like to get some reader feedback. What would you rather acquire?

• A) A start-up with a killer product and a mediocre team, or;
• B) A start-up with a mediocre product and a killer team.

It is a very hard decision if you consider both sides. Both have their advantages and downfalls.

Initially, I (and many others I am guessing) immediately chose B. After all, the team is absolutely critical to success. Human resources are at the focal point of the new information / knowledge-based economy. How could you not choose B? 

But consider a revolutionary product or service that sells itself. Assume that barriers to entry have been set in place. Regardless of the team, one is certain that this product is going to take off and eventually reach widespread adoption. Is there really a need for a strong team if the product sells itself?

If you had to put your own money on the line, would you opt for the killer team or the killer product?