Startup Addict Musings

Is Facebook really worth over 3x the price tag as the Myspace purchase? Maybe the Youtube purchase is still fresh in everyone mind. Facebook is a more concentrated niche but has substantially less users than Myspace. In addition, Facebook is now opening up to outsiders (non-college students) in order to scale and attract more eyeballs.

As the market continues to attract scorching valuations like the g0-go web 1.0 days, one has to ask the 23-year old genius creator….isn’t a cool$1 billion enough? It would certainly go along way in paying off the student loans.

I do have to give credit to CBS. The network joins a minority of traditional media companies that have finally figured out Web 2.0 (beyond the bubble) is a lot like the Burger King motto….”Content your way…right away”. The amount of content that a media entity like CBS (Viacom conglomerate parent) owns is staggering and clearly broadcast (traditional media in general) is on the decline and continues to fragment to an increasing number of media distribution choices, many that do not happen in real time ergo ipod and tivo. Finding new and multiple distribution outlets to monetize the same content just makes sense and is paramount when traditional revenue streams are drying up. I remember from the new media division I launched at Scout in Boston my year 2000 mantra was ( I have always been guilty of adopting too early) “create once and distribute many.” One of these days I actually post some early power point presentations I prepared for angel funding but again I digress.

In fear of a totally supportive post, one bone of contention to mention for the CBS acquisition of Last.fm is the uncertainty it possesses with the recent Internet royalty ruling (debacle rather). The Copyright Royalty Board (CRB), created by Congress to settle royalty disputes in the music business, implemented a per channel and music fee structure that will cripple Internet radio in the United States. This ultimately may not be a big deal for CBS because the pockets run deep and the sum of the parts are greater than the whole…but it will sting the profit a bit and small radio stations (free choice in general) will be eliminated. My right-wing bleeds out a bit when politics interfer with private enterprise. In the meantime, let’s keep our eye on the ball or at least CBS.

The premise is “middle tail” as Venture Beat dubs it. Comedians that are ripe for the limelight but fall short of the rare and unique success of Comedy Central and Saturday Night live.

Luckily Startup Addict is a social network targeted at a vertical for entrepreneurs, investors and anyone in the startup value chain allowing Marketplace to be specifically geared to buying and selling startups, blogs, web 2.0 properties and brick & mortar businesses.

Now that I’ve clarified the differences let me step off my soap-box and finish disclosing the implications of Facebook’s move into classifieds. When you look at the success of Craigslist, it’s hard to imagine how it could be more successful. Beside leaving advertising money on the table to stay loyal to the free user base, one must look at the missing social connection. At the end of the day Craigslist is a best-of-breed online classified website nothing more, nothing less. Facebook on the other hand has the ability to offer all the features of Craigslist to a huge user base as well as provide the coveted social connection users crave. In addition, it legitimises the trustworthiness of the buyer and sellers by revealing who is connected to who.

Although classified competition will continue to heat up…social networks will continue to persevere by building walled-gardens and catering to its’ users as a one-stop shop. Niche social networks may end up being the resilient cockroaches of the Web 2.0 blowout.

NYT has the full scoop.

Although the medium is different subsidizing content through advertising is not. This move again showcases the increased desire of traditional media to continue brand extension into the online arena. One thing we know for sure, traditional media such as News Corp and CBS are not afraid to pay for it whether broad or niche.

The question I ask, do you feel this trend of celebrity voyeurism will continue or will it be a flash in the pan business model with limited novelty? Leave me your comments.

It’s nice to see quality startups being funded barely in the 5 digits (12K from Y Combinator). The peer-to-peer funding side of StartupAddict should blossom sapling companies like Scribd into Red Oak trees all day long for budding entrepreneurs.

Hats off to the Scribd founders and congrats on the high valuations.