A large number of social networking companies face crisis as digital advertising is on a downswing, revealed a research from consultants Deloitte.
The researchers said that the websites, which had survived the downward trend, might be forced to supplement their revenue with pay-subscriptions, selling members' data or extra financing.
The eMarketer revealed that the predictions came as growth forecasts for digital advertising had halved from 17.2pc to 7.2pc for next year.
According to the Deloitte research, with the revenue declining, the cost of storing electronic data has soared to more than 100m dollars per year for larger sites, as users increasingly want to upload photos and videos, which consume memory.
"The book value of some social networks may be written down and some companies may fail altogether if funding dries up," the Telegraph quoted Paul Lee, Deloitte director of research for technology and telecommunications, as saying.
He added: "Average revenue per user for some of the largest new media sites is measured in just pennies per month, not pounds. This compares with a typical average revenue per user of tens of dollars for a cable subscriber, a regular newspaper reader or a movie fan."
Estimates have revealed that there are more than 1,000 social networking sites on the internet.
Among these are almost 100 big players, which are host to 22pc of UK internet users, and the most popular ones, including MySpace, LinkedIn, Twitter and Facebook, are likely to be more resilient in the face of the advertising slowdown.
However, many of the most popular social networks, such as Facebook and Twitter, do not yet generate large profits.
"Neither (Facebook or Twitter) has yet demonstrated that it can make money on a scale that matches its number of users. Twitter has yet to sketch out plans to monetise its blogging site. Revenue has always been an issue for Facebook," said Madan Sheina, an analyst at Ovum.
While Facebook was valued at 15bn dollars, Microsoft at the same time took a 240m dollars minority stake in October last year.
"With the economy spiralling into a downturn that figure might seem to be exaggerated right now," said Sheina.
Mark Zuckerberg, founder of Facebook, has claimed that for the next two years, they are focussing on growth instead of making money.
However, many signs indicate that the company is feeling the strain of the downturn, as it recently cancelled a plan to allow its employees to sell off shares early owing to the current economic recession.
Tuesday, December 30, 2008
Biggest Tech Stories Of The Year 2008
Courtesy: Forbes.com
Turbulent as the last 12 months have felt, 2008 may go on record as the year when the most important events in technology news were those that didn't happen.
Despite all the media's coaxing, Microsoft and Yahoo! failed to consummate their star-crossed love affair. Google came away empty-handed from its bid to buy up swathes of radio frequency in the FCC's spectrum auction. And even if he won't appear at 2009's Macworld, Steve Jobs did not die - a fact that may bewilder loyal readers of Bloomberg or CNN.com.
No, 2008 wasn't a year for dramatic twists or industry-shaking news bombs in the world of technology. Thanks in part to a growing recession and the financial crisis that quickly rippled through the tech economy, 2008 was a year in which incumbents stayed on top, disruptors crept in, ever so slowly, and the industry's laggards held on for dear life.
In fact, the biggest success story of the year was really a sequel to a 2007 coup d'etat: the iPhone 3G. When Apple's smarter smartphone officially launched in June with a smaller price tag and a game-changing application platform, Apple stopped flirting with the handset market and started owning it. The iPhone, originally an expensive wonder toy for elite technophiles, became--by some counts--the most widely-used cellphone model in the world.
Google also had some wireless successes. Though the search giant may not have won the wireless spectrum auction that began in February, it achieved its real goal: lobbying the FCC to open up its 700-megahertz frequency, a win that could allow users to access any wireless application on any network. And that vision became clearer with the launch of the G1, the first phone to use Google's Android operating system, and perhaps the only one capable of rivaling the iPhone's buzzing cloud of media hype.
Meanwhile, what was occupying fellow tech giants Microsoft and Yahoo!? A strange, many-months-long mating dance that ended in mutual frustration and extremely bored reporters. While the two companies played games largely based on pride and miscommunication, Google's share of Internet searches climbed above 70%, according to Web-tracking firm Hit wise, dwarfing its two major competitors. Microsoft's buggy Vista operating system became a running joke, with no relief from marketing stunts like "Mojave," a bizarre blindfolded taste test, or Jerry Seinfeld's mystifying ad campaign. Yahoo!, for its part, found no solution to its lagging second-place search ad platform, least of all getting in bed with its biggest competitor in a deal no one believed would be approved by anti-trust gatekeepers.
In the gaming world, too, big moves stalled. Electronic Arts' dramatic bid for Take-Two Interactive fizzled after the release of "Grand Theft Auto IV," Ear's main target in the deal. Spore, the most anticipated piece of software in years, disappointed gamers with its crippling digital rights management and disappointing game play. The only record it broke was the number of times it was illegally downloaded. Overall, the biggest winner of the year was the endlessly popular WI, a console that launched in 2006.
To be sure, big tech stories didn't disappear in 2008. But even more than in years past, innovation bubbled up from below, disrupting the market in ways only just beginning to become clear. Notebooks--those cheap, simple PCs aimed at pulling their applications from Internet--solidified as a new and dangerously appealing alternative to high-performance machines.
Smart phones started to look less like expensive handsets and more like cheap computers. Twitter emerged as the new digerati communication medium. (See "10 Steps for Staying Always On.") And while the Blu-ray high-definition format won its long battle against HD-DVD, the real winner in the future of video was far more stealthy: streaming sources like Hulu.com and Netflix, with popularity that's only beginning to percolate.
Some of the year's tech trends produced real victims: Web advertising, ADD for instance, continued to unnerve the journalistic world like a toddler with a machine gun. Venerated newspapers swooned as advertising went from their pages to their Web sites before vanishing into the digital ether. Book sellers, too, saw sales plummet. Oprah gave a rousing endorsement for Amazon's e-book reader, the Kindle, which debuted in 2007, but those sales are still far from helping publishers make up the losses from their print divisions.
But most of 2008's failures were far slower. Deteriorating dot-com boomers like Nortel and Sun Microsystems eroded further in the weakening economy, and managed to lose enormous value without inspiring an acquisition. Since the beginning of the year, Sun's stock price has dropped by three-fourths, Nortel's by more than 98%. Motorola, the sick man of the cellphone market, has watched 75% of its value slip away, too.
In fact, the most heartening tech news of the year may not have been in business, but in politics, where a Twittering, Facebook-friendly, YouTube'd candidate trumped his e-mail-illiterate foe. Barack Obama isn't just focused on using tech to get elected. He also promises to use tools ranging from universal broadband to green tech in shaping the future of the country. And that shift in the government's attitude toward technology could mean 2009 will be a year when tech headlines are not just big - they may also be good news.
Turbulent as the last 12 months have felt, 2008 may go on record as the year when the most important events in technology news were those that didn't happen.
Despite all the media's coaxing, Microsoft and Yahoo! failed to consummate their star-crossed love affair. Google came away empty-handed from its bid to buy up swathes of radio frequency in the FCC's spectrum auction. And even if he won't appear at 2009's Macworld, Steve Jobs did not die - a fact that may bewilder loyal readers of Bloomberg or CNN.com.
No, 2008 wasn't a year for dramatic twists or industry-shaking news bombs in the world of technology. Thanks in part to a growing recession and the financial crisis that quickly rippled through the tech economy, 2008 was a year in which incumbents stayed on top, disruptors crept in, ever so slowly, and the industry's laggards held on for dear life.
In fact, the biggest success story of the year was really a sequel to a 2007 coup d'etat: the iPhone 3G. When Apple's smarter smartphone officially launched in June with a smaller price tag and a game-changing application platform, Apple stopped flirting with the handset market and started owning it. The iPhone, originally an expensive wonder toy for elite technophiles, became--by some counts--the most widely-used cellphone model in the world.
Google also had some wireless successes. Though the search giant may not have won the wireless spectrum auction that began in February, it achieved its real goal: lobbying the FCC to open up its 700-megahertz frequency, a win that could allow users to access any wireless application on any network. And that vision became clearer with the launch of the G1, the first phone to use Google's Android operating system, and perhaps the only one capable of rivaling the iPhone's buzzing cloud of media hype.
Meanwhile, what was occupying fellow tech giants Microsoft and Yahoo!? A strange, many-months-long mating dance that ended in mutual frustration and extremely bored reporters. While the two companies played games largely based on pride and miscommunication, Google's share of Internet searches climbed above 70%, according to Web-tracking firm Hit wise, dwarfing its two major competitors. Microsoft's buggy Vista operating system became a running joke, with no relief from marketing stunts like "Mojave," a bizarre blindfolded taste test, or Jerry Seinfeld's mystifying ad campaign. Yahoo!, for its part, found no solution to its lagging second-place search ad platform, least of all getting in bed with its biggest competitor in a deal no one believed would be approved by anti-trust gatekeepers.
In the gaming world, too, big moves stalled. Electronic Arts' dramatic bid for Take-Two Interactive fizzled after the release of "Grand Theft Auto IV," Ear's main target in the deal. Spore, the most anticipated piece of software in years, disappointed gamers with its crippling digital rights management and disappointing game play. The only record it broke was the number of times it was illegally downloaded. Overall, the biggest winner of the year was the endlessly popular WI, a console that launched in 2006.
To be sure, big tech stories didn't disappear in 2008. But even more than in years past, innovation bubbled up from below, disrupting the market in ways only just beginning to become clear. Notebooks--those cheap, simple PCs aimed at pulling their applications from Internet--solidified as a new and dangerously appealing alternative to high-performance machines.
Smart phones started to look less like expensive handsets and more like cheap computers. Twitter emerged as the new digerati communication medium. (See "10 Steps for Staying Always On.") And while the Blu-ray high-definition format won its long battle against HD-DVD, the real winner in the future of video was far more stealthy: streaming sources like Hulu.com and Netflix, with popularity that's only beginning to percolate.
Some of the year's tech trends produced real victims: Web advertising, ADD for instance, continued to unnerve the journalistic world like a toddler with a machine gun. Venerated newspapers swooned as advertising went from their pages to their Web sites before vanishing into the digital ether. Book sellers, too, saw sales plummet. Oprah gave a rousing endorsement for Amazon's e-book reader, the Kindle, which debuted in 2007, but those sales are still far from helping publishers make up the losses from their print divisions.
But most of 2008's failures were far slower. Deteriorating dot-com boomers like Nortel and Sun Microsystems eroded further in the weakening economy, and managed to lose enormous value without inspiring an acquisition. Since the beginning of the year, Sun's stock price has dropped by three-fourths, Nortel's by more than 98%. Motorola, the sick man of the cellphone market, has watched 75% of its value slip away, too.
In fact, the most heartening tech news of the year may not have been in business, but in politics, where a Twittering, Facebook-friendly, YouTube'd candidate trumped his e-mail-illiterate foe. Barack Obama isn't just focused on using tech to get elected. He also promises to use tools ranging from universal broadband to green tech in shaping the future of the country. And that shift in the government's attitude toward technology could mean 2009 will be a year when tech headlines are not just big - they may also be good news.
Bride exchanges wedding vows wearing coconut shell ornaments
Giving a go-by to the Indian craze for gold and diamond jewellery, a newly married couple in the south Indian province of Kerala exchanged wedding vows yesterday wearing ornaments crafted from coconut shells.
Salman Rushdie says provoking people is in his DNA
Author Salman Rushdie, who was once condemned to death by a former Iranian spiritual leader, has said that provoking people "is in his DNA".
Rushdie's fourth novel, The Satanic Verses (1988), was at the center of protests from Muslims in several countries. Some of the protests were violent and Rushdie faced death threats and a fatwa issued by Ayatollah Ruhollah Khomeini, then Supreme Leader of Iran.
According to Khomeini, he had portrayed the prophet Mohammed in irreverent terms - and by doing so had forfeited the right to life.
In response to the call for him to be killed, Rushdie spent nearly a decade largely underground, appearing in public only sporadically.
Now, while in his interview with The Telegraph, London, 'The Enchantress of Florence' author says he "can't avoid making enemies."
When asked why he provokes such dramatic reactions, Rushdie says he can't avoid it, as if it's somehow stamped on his DNA.
"There's a quote by Robert Browning that I'm particularly fond of - "Our interest's on the dangerous edge of things." Something in me, not consciously willed, takes me to those edges. But, at the same time, part of the nature of the artist, at least as I see it, is to increase - by however little - the sum total of what it is possible for us to understand. Nothing of great interest for me is done sitting safely in the middle of the room. You want to push the boundaries as much as possible. But I suppose if you do that then people are going to push back," he said.
Rushdie's fourth novel, The Satanic Verses (1988), was at the center of protests from Muslims in several countries. Some of the protests were violent and Rushdie faced death threats and a fatwa issued by Ayatollah Ruhollah Khomeini, then Supreme Leader of Iran.
According to Khomeini, he had portrayed the prophet Mohammed in irreverent terms - and by doing so had forfeited the right to life.
In response to the call for him to be killed, Rushdie spent nearly a decade largely underground, appearing in public only sporadically.
Now, while in his interview with The Telegraph, London, 'The Enchantress of Florence' author says he "can't avoid making enemies."
When asked why he provokes such dramatic reactions, Rushdie says he can't avoid it, as if it's somehow stamped on his DNA.
"There's a quote by Robert Browning that I'm particularly fond of - "Our interest's on the dangerous edge of things." Something in me, not consciously willed, takes me to those edges. But, at the same time, part of the nature of the artist, at least as I see it, is to increase - by however little - the sum total of what it is possible for us to understand. Nothing of great interest for me is done sitting safely in the middle of the room. You want to push the boundaries as much as possible. But I suppose if you do that then people are going to push back," he said.
Subscribe to:
Posts (Atom)