Google, Yahoo, eBay.. Next Acquisitions

May 23, 2006

Here is another long in-depth article by me. I jumped in the web 2.0 bandwagon not very long ago. But I think I learned quite a lot of things.. I should thank Om Malik (GigaOM), Michael Arrington (Techcrunch) and Digg for this. Here are my findings; the winners and losers of web 2.0..

But before starting let me state the acquisition behaviors of big fish:

Google and Yahoo buy small, innovative startups. In some sense, they reward the creativity. The acquisitions are generally low priced.
MSN acquires small search startups; the prices vary
eBay makes big and very profitable (IMHO) acquisitions; examples are Paypal and Skype.
AOL is very hungry for social web applications.
I’d like to see Amazon and Apple also in this list, but I didn’t hear anything about their acquisitions.

YouTube


Great idea and great implementation; already had a very large user base. This is mostly thanks to Sequoia Capital support and all the marketing activities they did. But there is so much VC money in that it is nearly impossible for an acquisition, I believe. They don’t seem to have a good business model for now, but I’m sure they’ll have in time. They’re racing in a very competitive market; there’s no significant added values but the market will clearly replace the conventional TV attitudes and bring a lot of money. They should add online movie editing features as soon as possible; because their competitors started to do. Or they’d better buy a startup quickly for this (MotionBox, Click.tv, JumpCut). They should end up by going public.

SphereTechnorati

Blog Search is quickly becoming one of the “next big things” in the internet industry. Technorati was absolutely my favourite in this domain. But I don’t why.. I can see nothing special in their technology; and their interface is too cluttered. It should have been much more cleaner; because a you don’t search web pages here, you search blog entries; and people enter thousands of blog entries in a second (for now…) So you have to show as much as possible in one single page. But contrarily, Technorati shows just a few of them in a very small space.
Sphere, on the other hand, is much more clean. Plus, it just started to cooperate with Times. That’s a big plus. Google and Yahoo may trust in their core technology but I think they won’t be able to stop startup innovations; and their blog search technologies can never be as acceptable as these ones. However Yahoo’s way of using blog search inside news pages is very clever.
Another point is that Technorati looks like it’s so big, so VC money involved that it can’t be subject to an acquisition..

Riya

Very good idea but their operation costs are too high. I don’t see anything different in their OFR, OCR algorithms. Just like an online version of conventional OFR, OCR softwares already available. Again there’s too much VC money in it. Google is one of the investors as far as I know. So I don’t think they’ll approach to buy them. Yahoo may buy and use them in parallel with Flickr. Or they may end up by going public. But both Riya and YouTube should be careful about their operating costs.

TagWorld


Do any of you wants to see a new social networking web site again?? Personally I don’t but TagWorld goes well and may become subject to an acquisition by big TV companies. Because TV companies are hunting social apps these days for the next generation TV.

Digg


Very good service. I’m a big fan of it. Shows the power of masses. Beaten Slashdot. Should be bought by Yahoo, can be a very good service along with the new Yahoo Tech. Their innovation really deserves a big reward. I think, their blueprints like Wikio and Newsvine will lose, but Digg won’t.

Opera


Yes we heard many rumors about this acquisitions but it was always nothing more than being a rumor. But now I believe this can really happen. I know that Opera may be too expensive for Google (when compared to their previous acquisitions I mean); but the inevitable expansion of IE7 may push Google to do this. They may buy Opera to fully control them, then release a free, thin, live Linux distro with Opera preinstalled. I also support Google’s Writely acquisition and believe that they should continue with the web-office project (as opposed to what Schmidt said) in parallel with such a mini operating system.

Facebook


Facebook was the biggest surprise of this year. Their rejection of $600M shocked many but I believe if they really have so much users, if they really control the college market, they were right to ask for more money. Facebook can become the next big thing. I don’t think anybody will afford to buy them, but they may make a lot of money by going public.

Meebo


It’s already a big success. They dominated the IM market; and the word is being spread out so quickly! They are backed by Sequoia. They control a critical market; all our communications is in their hands! Some people argue that they will end up in eBay’s hands. But I don’t think so; because eBay doesn’t need meebo’s userbase; so it would be a too expensive buyout for technology only.. For technology, they can buy meebo’s weaker alternatives. meebo can end up with a MySpace like acquisition or going public. They can use the empty space on their screen for advertising.

Federated Media


Google may buy them. Because Google always buys profitable web advertising startups. So, as FM is very succesful, they can buy them too. However FM doesn’t have any powerful algorithm or sth; so I’m doubtful..

Pandora


I got addict to it. This is a high quality radio service. They learn from our listening experiences. Yahoo may buy them. However Apple could fit more to such an acquisition. Their algorithms do really work and I like them. Their technology and user base are their largest assets.

StumbleUpon


They hit 850.000 users and they’re going towards 1M. They may end up with a del.icio.us style acquisition. They seem like a very bright acquisition target. Fits to Yahoo. It may be yet another social boomarking fork but it is really different and deserves to be bought. Bookmarking sites allow search engine providers to empower their search algorithms too..

PageFlakes


This market is clearly too overcrowded again. Netvibes may seem like the most succesful one. However this Paris based company is not as innovative as German PageFlakes. PageFlakes was the first to start tabs and mass editing r/w features. However NetVibes currently has more visitors and is backed by Pierre Chappaz.

LinkedIn


A useful application of social networking. Going very successful. I don’t know how they will end up, but they’re very succesful!

Zoho


As I said, web office can really be a profitable market. Google stepped in with Writely but they deny it. Maybe they don’t want to seem too distracted to their investors. Yahoo should also do it; and if they’d do it, Zoho can be a very good buyout for them. It is a very good office suite for now. Not as good as Writely, because they’re not that focused but the team shows that they have the potential. So Zoho can be bought by Yahoo in the near future I think.

Grou.ps


May help Google to steal userbase from Yahoo Groups. They may be the target of Google to empower Google’s weak chain, Google Groups. Can be used for data mining purposes also

Fundable

No need to talk.. Very good idea and it works! And this is a highly money involved idea. Can be a subject to small acquisition by eBay.

30Boxes


Calendar market was hot, but with Google Calendar it lost its popularity. 30Boxes was the clear winner and still is. But I don’t think they can survive against Google. They may be the target of Yahoo for an Oddpost like acquisition. But Yahoo already got the talented OddPost team and may expect them to construct new Yahoo Calendar; so in this case they won’t need 30Boxes.
Kiko, with its MySpace move tries to be the target of AOL… This is quite possible I think.
Another racer, SpongeCell has a good idea: “natural language recognition” for SMS’ing calendar entries. But I don’t think their technology fully works for now. Otherwise they could be subject to a small acquisition by calendar giants like Yahoo and Google.

Flagr


Good idea, could be used by giants for data mining purposes. But they may not have any chance as long as their data is untrustable (you enter your address by hand, not automatically)

Spotback


This is a similar to approach Digg. Instead of trusting power of masses, they trust in personalized content. Their interface is clean. If their technology can really do it, they’ll win and be subject to an acquisition. Otherwise, they may end up with the original owner of this idea, reddit. Reddit’s idea was good, but I couldn’t see anything special in their technology. And reddit’s interface does really suck!

ether


Responds to sth we always felt the need but never thought it can be realized. I think this is a very very succesful idea; but can’t see any potential acquisition scenario for now.

Amiglia


Social networking for families.. Very good implementation. May feed AOL’s hunger for social applications.

MusicHawk


The best music discovery I’ve found so far. May be subject to an acquisition by Yahoo (for Yahoo Music) but this seems like a highly crowded market; so they (or any other) should differentiate itself very well.

WordPress


Blogging is a very precius arena. WordPress is obviously a leading player in this arena just after Blogger and Typepad. I believe it will be bought by a giant in the near future. Open source friends will love the company that willl buy WordPress. Plus, WordPress has a business plan in its open source offerring too.. If you use WordPress (even if it is self-hosted) you should use Kismet which still requires a WordPress account! This makes it even more valuable.

This list may be way too limited. These are the ones I took down in the recent months but there are more of them. And I may write about them in the following days.

UPDATE.. READ ON https://multescu.wordpress.com/2006/05/24/google-yahoo-ebay-next-acquisitions-2/

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45 Responses to “Google, Yahoo, eBay.. Next Acquisitions”

  1. Lowload said

    Personally id love to see a google/digg relationship rather than a yahoo/digg relationship. i think the two sites go hand in hand in terms of technology and aims of the internet, mabie replacing google news with digg?

  2. Lowload said

    sorry one more note, i think that a company with troubles such as napster should look at pandora , and a tie in service for buying mp3’s. as napster currently let you listen to a song 5 times, i think they could Expand on pandoras exsiting structure, and turn it into a proffitable market.

    [Lowload.co.uk] – UK Dedicated Servers

  3. Jay said

    I don’t think WordPress is going to or can be aquired. You can’t exactly buy a community and have it stay intact. Novell found this out when it bought SUSE. Besides, who would be the authority to sell it off? The only company I could see getting away with it is Google, and that would be thin.

  4. Jay said

    errrr….. in the first sentence, that should be “isn’t” and “can’t.” Bleh….. frickin’ typo’s!

  5. Zen said

    excellent article. Very helpfull to learn what is going on out there in Web 2.0 World.

    thanks!

  6. Tom said

    This is without doubt the most fanciful, fact-less piece of writing I’ve seen all day- and it’s not even 12.

    Simply listing ‘web 2.0’ companies and linking their respective industrial heavy weights together far from reflects a buying intention – or their ‘success’. Your argument is flawed in many senses. Skype, for example, which you bill as a very profitable purchase is far from that. It cost eBay a shed load of money and faces a massive amount of competition in the market – skype did well because it was one of the first – it is one of many now.

    Another example- why would Yahoo buy Riya – noting Google’s investment (and previous interest), its own purchase of Flickr, and it’s own photo sharing services??? One might come to the conclusion that if the ‘god’ google turned it down, why on earth would it be good enough for anyone else?!

    Amazon’s ‘web 2.0’ stuff, btw, can be found at a9.com, or their recently launched storage service, or the Mturk service…

    Madness. Suggest you get a new area of interest – fast. Jump of that band wagon!

  7. javazingo said

    Tom, he talks about an acquisition there.. MTurk and a9 weren’t acquisitions but internal developments.

    and i personally found this article very insightful

  8. Janssen said

    Google employs almost all core Firefox developers. I don’t think Opera is going to be a acquisition target.

  9. What about vSocial.com ??

  10. Keith said

    I don’t like to see big companies acquiring so many small entities, and eventually become a big mega-enterprise. Eventually, it may end up with a few huge companies owning all these things in the world. with monopolising their own specialised services.

  11. javazingo said

    Keith but this is needed for innovation; innovation can’t be made inside the big companies! ibm and microsoft grew by consuming startups! acquisitions are what makes Silicon Valley brains working and working

  12. seriously said

    welcome to the internet. half of these sites are old and won’t make anywhere at all. digg.com is great, but to say it beats out slashdot is assinine. digg.com does more world news and local crap. the bad of digg.com is the amount of no name blogs it makes the owners think are actual news sites. disturbing. im not against the blog revolution, but how many more filters do i need ?

  13. sastopeit said

    PageFlakes and LinkedIn are linked to Facebook. Thought you might want to fix it. Cheers and GO STUMBLEUPON!

  14. sastopeit said

    … Oh, and Technorati doesn’t link to anything.

  15. aweblogs said

    nice article..although you would need to change the link for “LinkedIn” 😉

  16. multescu said

    Yihaa!!! It got to the Digg frontpage..

    OK guys, I’ll make the link corrections and a few links too (they were in my mind but I forgot to put them here!!)

  17. Victor said

    I think this site may have something to it…it may apeal to one of the giants. It allows anyone to send free text messages to any cell in US without you even having to know the destination cellular provider (unlike the competition).
    This service is totaly free and it doesn’t even require one to register.
    Thumbs up! I’d say it’ll get acquired by Yahoo maybe…

  18. Cliff said

    Skype profitable? Prove it please.

    I don’t think that acquisition has been profitable.

  19. Interesting article but I hope that people don’t start hyping up companies against as purely acquisition targets less we repeat the bubble of former years. I think there are some really great innovations going on in the web and naturally some will succeed where others fail, but a company should live and breathe on making itself a success on its own rather than relying on being bought.

    There was also no mention of the evolution of shopping in the web 2.0 space – social shopping!

  20. Pandora but not Last.FM?

  21. wee said

    Seems that the Google – Opera link is kinda unlikely considering how Google has been throwing its weight behind Firefox and not been supporting Opera in many of its services. Till now, Gmail works almost fully in the Opera beta version, Pages and Calendar aren’t supported, just to name a few.

  22. buk said

    What, no Feedburner?

  23. What about Feedburner?

  24. ID34 said

    Excellent list and write up.

    http://www.id34.com

  25. pai said

    Want to add http://www.OOPAR.com which allows to Chat on AIM, ICQ, Jabber, Gtalk, MSN, and Yahoo! Messenger via your web browser in one simple AJAX interface.

  26. hemendra said

    Excellent thread, and some insightful comments from the community – thanks!

    On the subject of learning from these threads:

    I wanted to point out: http://www.talktrust.com
    Allows anonymous calls and complete call management for free. What I liked about it v/s Skype/others, is that this is based on a hub-and-spoke architecture as opposed to going P2P. The “hub” allows for

    At a recent panel debate at TiEcon 2006 in the bay area, I walked away with a good insight into why some web2.0 companies rocket off while others ramp up slowly …

    As a startup, do you spend your limited marketing $$s wooing early-adopters? OR, do you go after the mainstream in parallel (the proverbial “even my mom can use this application”).

    I see TalkTrust doing this well. Appeals to the early adopters, and getting smiles from several moms and their teenage kids on MySpace 🙂

    Cheers!
    hemendra

  27. […] Ivan Multescu » Blog Archive » Google, Yahoo, eBay.. Next Acquisitions Predictions for next wave of web 2.0 acquisitions. (tags: web2.0 acquisitions startups) […]

  28. Tara said

    nice. i like talktrust
    competition is good.
    let the race begin.

  29. Dave said

    Great write-up, Ivan…

  30. Google, Yahoo, eBay.. Next Acquisitions…

    Google and Yahoo buy small, innovative startups. In some sense, they reward the creativity.
    MSN acquires small search startups; eBay makes big and very profitable (IMHO) acquisitions;…

    ……

  31. dino said

    beautiful online information center. greatest work… thanks

  32. […] Part 1: Google, Yahoo, eBay.. Next Acquisitions Part 2: Google, Yahoo, eBay.. Next Acquisitions -2- […]

  33. […] will buy small, innovative Web 2.0 startups? A nice idea from Ivan Multesecu: Part 1: Google, Yahoo, eBay.. Next Acquisitions Part 2: Google, Yahoo, eBay.. Next Acquisitions […]

  34. […] eben habe ich diesen Artikel (und diese Ergänzung) über Digg gefunden – eine lange Liste von verschiedensten ‘Web […]

  35. megamega said

    Myspace: How to get lots of adds, the EASY way!
    on: http://tinyurl.com/67ekka

  36. James said

    It’s funny talking a look at the list now. Guess the main one’s that are huge are Google, YouTube and Facebook.

  37. merelje , http://allcountries.co.cc – Cheap place to buy pills online.

  38. Kayla said

    I don’t like the durable of all those lists he’s making – it’s like fetching too innumerable notes at seminary; you experience you’ve achieved something when you haven’t.

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