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Twitter Gets Its Funding! Posted: 24 Jun 2008 03:05 PM CDT Twitter has announced the new investors that they have accepted funding from: Bijan Sabet of Spark Capital and Jeff Bezos of Bezos Expeditions (as well as CEO of Amazon). How much have they raised exactly? They haven’t said but Om Malik previously speculated that the amount was $15 million. In their announcement blog post, Biz Stone suggests that they will soon have a sustainable business model for the company. No company has been able to figure out a way to monetize microblogging so far but apparently there is something in the works. With Jeff Bezos as an investor I’d imagine Amazon S3 ad EC2 handling some of the scaling issues for the company. That’s one of the primary reasons Bezos invested in Animoto, a company which today announced they have now expanded their service offerings for businesses. It will be interesting to see if this team can pull off the impossible before everyone runs off to Plurk. Ok, maybe that won’t happen but the company definitely has a challenging road ahead. Congratulations to the Twitter team and good luck on building a more powerful product!

Google Takes on SocialAds Posted: 24 Jun 2008 02:32 PM CDT Google, once foreign to targeting based on social data, has launched Google Ad Planner. The service is targeted at media buyers and enables them to select ad placements on various sites based on demographic information as well as traffic data. Currently the service is limited to 4 types of demographic data: age, gender, education and household income. Compare that to Facebook which currently offers targeting based on 8 variables: location, gender, age, profile keywords (found in interests, favorite music, movies and more), education status, workplaces, relationship status and what gender they are interested in dating. While Facebook offers more variables, Google’s information is broken down in to the categories most frequently targeted by media buyers. The real question is if this is going to cut into Facebook’s ad revenue or prevent them from attracting marketers more effectively. Fox Interactive Media has a similar offering to Facebook’s called HyperTargeting which leverages MySpace profile to segment users. According to MySpace advertisers have been increasingly demanding HyperTargeting which has also been producing higher CPMs. Google needs to figure out a way to capture some of this market and their new Ad Planner service appears to do that. While the social web continues to wait on a breakthrough advertising service, Google is using traditional advertising segmentation to make spending easier for media buyers. Do you agree that this new service will reduce the attractiveness of SocialAds?

Battle Over Mobile Web Heats Up Posted: 24 Jun 2008 11:32 AM CDT With the new iPhone set to launch next month, anticipation from consumers is running high and concerns from mobile competitors are also running high. Nokia’s stock is almost 50 percent off of their 52 week highs which the company hit back in November. Analysts are speculating that the new iPhone is going to dominate the smartphone market, putting competing companies on the defensive. Today’s news that Nokia has acquired Symbian and is opening up the platform for developers is one of those defensive maneuvers. The social web is also getting ready to explode on mobile devices with yesterday’s announcement of Nokia acquiring Plazes, a location based social network. It’s clear that there is now a fierce race to become the dominant player on the mobile social web. Currently the leading mobile social networks are not the same as the leading web-based social networks, suggesting that this area is still anybody’s game. Yesterday’s acquisition of Plazes by Nokia further highlights this trend ad companies are not holding back in their race to become the dominant force on the mobile social web. It’s an extremely exciting time for mobile and over the next six to twelve months we are going to see an increasing amount of buzz in this area. It’s time to start placing your bets. Who do you think is going to become the most dominant force on the mobile social web? Who will be the leading mobile social network? Who will become the dominant platform for developers?

The Social Network Valuation Equation Posted: 24 Jun 2008 08:00 AM CDT For the past few days, there has been intense conversation surrounding the valuation of social networks. It began with Andrew Chen’s analysis of Facebook and MySpace which leveraged Google’s new Trends for Websites services. Not only does Andrew suggest that, “social networks have weaker network effects than previously speculated” but he also suggests that not all social network users were created equal. His basis is that ad spending in the U.S. is quadruple the size of the next largest advertising market, the U.K. Yesterday, Mike Arrington furthered supported this argument by creating his own point based system which associates average valuation model which connects the average ad expenditure per person in each country and multiplying that into the size of each network. I’ve done some research myself over the past 12 months and I’ve come up with my own equation: Social Network Valuation (SNV) = (Repeat Monthly Visitors x Engagement x Virality) / Nobody Has Any Idea As you can clearly see in my heavily researched equation, nobody has quite figured out the answer to how much a social network is worth. The biggest challenge is that nobody has yet to figure out how to effectively monetize these sites. If you’ve attended any of the industry events you’d also know that the primary reason is that advertisers have not figured out how to measure this yet. While I believe exploring various metrics to determine more “accurate” valuations is an important exercise, I’m not sure that the models used so far are the most effective. What do you think are the most effective models for determining social network valuations?

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