Facebook, MySpace, et al = Double Bubble?

AdViking has good days and bad days when pondering Social Media and sometime this means quitting Facebook and sometimes heavy use of Twitter.  Generally, the main point is that we are in the early iteration of the what and how of Social Media and we’ve got a long way to go before it’s all pervasive and delivering true value to the user.

Recently came across Charlene Li‘s deck on the Future of Social Networks on SlideShare and thought it was worth sharing as some solid consolidation of thoughts flying around the ether.  i.e.:

  • The youth are all ready heavily into this stuff (e.g.:  Club Penguin)
  • Your Universal ID has to be easier to use
  • AOL, Google, Microsoft will be coming hard into this space

Obscene Valuations?

Anyway, onto the main point and that is there’s a lot of debate if the valuations the Social Networks are getting ($15bill Facebook, $1bill LinkedIn, $850mill Bebo, $580 mill MySpace) are just crazy and more proof points that we are on the cusp of bubble2.0 or are just fair indications of value.

There have been some recent work in just this area that is useful to ponder.

First, Andrew Chen had a stab at looking at MySpace versus Facebook: Analysis of both traffic and ad revenue, using Google Trends.

Second, Michael Arrington did some Modeling The Real Market Value Of Social Networks.

The later piece is the real interesting one to digest, mainly as they start from looking at a wider set of networks, use comScore data for the traffic and also the recent PWC ad spend numbers.  And though Arrington is the first to admit there’s some flaws in the model (e.g.:  LinkedIn comes out low but the actual traffic could be considered high value), you can still take it as a starting point based on some data rather than just plain rhetoric.

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One Response to Facebook, MySpace, et al = Double Bubble?

  1. dylanfuller says:

    Thanks for the sweet post, Simon. I still think I was right to quit Facebook, at least for me it was a total waste of time. I’ll be back wiht more on that thread later in the week. I like the models in the TC post, interesting. In the end, I am still thinking social networking is more more like emai. Which is where I want my social services to sit. More randomw thouhgts: I’ve also got to think some part of the social netowrking pie fragment with the likes of Ning.com. I don’t agree LinkedIn is worth $1B but if they can build in services (groups, email mgt, wiki) then they are well on the way to $500M.
    http://tinyurl.com/555w67

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