A niche social network for people recovering from addiction, called SoberCircle, hit Del.icio.us popular this morningand it made me think - "my goodness, the market for niche social networks must be nearly infinite." SoberCircle has never been profiled on any of the top web 2.0 blogs and we haven't received any press releases announcing their support for OpenSocial - but the site is yet another social network that made a mark on the web today.Most people who follow new developments in web applications closely contend that MySpace, Facebook and LinkedIn are so dominant, and their tiny challengers so numerous, that launching Yet Another Social Network is among the most foolish things an entrepreneur today can do. I disagree.What is a social network? Typically, it's just a website that offers users a profile page, the ability to publish to the web, to add other users as friends and to send user-to-user messages, or sitemail. That's simple but powerful stuff; it's functionality that countless real-world organizations will benefit from in the coming years as turnkey solutions become increasingly visible.Here's my 6 reasons why I believe that SoberCircle and many of the other seemingly random, obscure niche social networks online are in fact viable businesses in a huge, untapped market.There are huge numbers of users in play.The sheer number of people online already and coming online every day cannot be ignored. Many niche content sites, from sites about street drag racing to obscure medical conditions to drag racing while suffering from obscure medical conditions, that already receive traffic on more than monetizable levels. I talk to companies regularly that see substantial traffic to sites few of us here have likely heard of.If your niche website is not receiving significant traffic, and I know that many startup web app companies are not, then there's something wrong with your marketing, your product or your luck. It's probably not that your target market is saturated - there's very few that are.In-group communication is keyPeople will share information with groups of people they know they can relate to that they never would share in a general public forum. We all seek empathy and many of us have life experiences that cannot be meaningfully discussed outside of a context of shared understanding and a base of common experience. People in recovery from substance abuse is one such huge market, people with communicable diseases another, the insanely wealthy yet another - and the list goes on.Groups on existing social networks may satisfy some of this demand, but not the way that dedicated, topical "walled-gardens" will.Privacy is in High DemandTalk to the people at Vox, at Multiply, at Tumblrand elsewhere and they will tell you that there is substantial demandfor social networking and content publishing functionality behind a wall of permission.The idea that "privacy is gone" is itself an illusion. People choose what they publish to the open web and many choose to publish to closed pages for family, friends or even just personal consumption.Sex sells - on a plane, in a train, among stamp collectors and cheese aficionados.The page that drove so much traffic to SoberCircle today? A prurient taleabout "the most dangerous drug in the world," used in various crimes related to sex. (Not linking to it here, but you tried to click, didn't you?)Every niche that has its members has its scandal. People will come to your site if they can find that scandal and if they are interested enough in the niche, they will return. Fetishes themselves are infinite. I swear though, I read Valleywagdaily for research purposes only!Many people don't want to participate in general interest social networks.They will for work or a particular hobby, though.Data portability can enable a scalable soc net ecosystem.From OpenIDto OAuthto Open Widget - I mean Google's Open Social - many, many people are working to make it easier to move from one social network to another.When, in the glorious future, you can explore a new network with an existing login - knowing that if you choose to leave it you can take your new friends, writings etc. with you back to your home base, then social networks will flourish. When I can easilypost one blog post to both my Facebook notes and my SoberCircle profile (example only!) and another post to SoberCircle alone - then market conditions will have arrived for niche networks to truly thrive.Let's go forth and network!I really believe that this industry is just in its infancy. None of the incumbents are guaranteed total domination into the future and there's no reason to believe that the long tail of niche social networks won't prove economically, individually as well as in aggregate. Of course most startups in this sector will fail, that's the case in any sector, but as startup tech markets go I think it's a very smart market to be getting into right now.

  Just a couple of weeks ago, CNET's Don Reisinger wrote that Blockbuster was doomed. After posting a quarterly net loss of $35 million, closing 526 stores over the past year, and seeing its stock price tumble, Reisinger predicted that the company would be out of business in 2 years. "The way I see it, Blockbuster has two options: sell off the company as soon as possible or spend huge sums of cash on research and development and strategic partnerships with distribution companies to make downloading movies a viable alternative to Netflix," he wrote. "But unfortunately, I simply don't see this happening. I think Blockbuster will try to stay the course in the hopes it can find a way out. It won't."But Blockbuster CEO James Keyes doesn't see it that way. While he admits that pursuing Netflix hard with its Total Access service (by giving away free rentals that cost the company $29 million in the third quarter) was a mistake, he doesn't think the end is nigh.Keyes told the Associated Pressthat he believes in store rentals will be an important part of Blockbuster's business for at least 5 years (which assumes that Reisingers prediction of impending doom is wrong). Eventually, Keyes says that consumers will come to stores to download and burn movies to DVD at kiosks, or save movies to portable devices like phones or PMPs.Blockbuster will begin putting kiosks in stores soon, though initially, they will not be able to burn DVDs. The company will also put more emphasis on retail, and begin diversifying its revenue stream beyond rentals by selling electronics, soundtrack CDs, and books. Finally, Keyes plans to make use of Blockbuster's $7.7 million acquisition of the movie download service Movielink.Movielink, which was a joint venture between Paramount, Sony, Universal, and Warner Bros., reportedly sold to Blockbuster for far below its asking price of $50 million. That the movie studios have such a lack of faith in the movie download model, and that the market is crowded with mammoth competitors, including Amazon, Apple, Netflix, and Microsoft, probably does not bode well for Blockbuster. Further, if the study we reported on earlier today, which predicts a slow downin Internet speeds over the next couple of years, is accurate, it is unlikely that many people would give up discs for bits just yet.Photo credit: AP.Though kiosks and movie downloads make sense from a convenience standpoint -- no late fees, no chance a movie is unavailable, potentially infinite selection, etc. -- I'm still not convinced that Blockbuster can compete with Netflix. The major advantage they had over Netflix was the ability to offer free in-store rentals if people returned mailed videos to the store -- a practice that customers loved, but which cost Blockbuster $29 million in a single quarter. Keyes limited the free rentals for the Total Access program that were costing the company so much money, but that prompted 500,000 customers to leave the service.What do you think? Can Blockbuster ever compete with Netflix, Amazon Unbox, Apple iTunes, and the rest? Or are they doomed?

  If you have a fast broadband Internet connection, enjoy it while it's still fast. According to a study by Nemertes Research, video and interactive web sites will begin to overwhelm Internet service providers as early as 2010."Users will experience a slow, subtle degradation, so it's back to the bad old days of dial-up," Nemertes President Johna Till Johnson told USA Today. "The cool stuff that you'll want to do will be such a pain in the rear that you won't do it."According to the report, cable and phone companies, which provide 94% of the United States' broadband access, must invest about $55 billion to upgrade their networks to cope with the coming bottleneck. That is far more than planned, says Nemertes.The biggest upgrades will need to be made in upstream data capacity. Until recently, the web was mainly read-only, and service providers built their networks around downloading. But with the explosion of video and photo sharing, self publishing (blogging, etc.), and bandwidth-intensive activities like video conferencing, networks will begin to feel the strain on the upstream end."Two years ago, nobody knew what YouTube was," said Johnson. "Now, it's generating 27 petabytes of data per month."Much of the cost of upgrading will be in installation of higher-capacity lines, according to the Nemertes study. Verizon's new fiber optic service, FiOS, which reaches 1.3 million users in the US (myself included) is a start, but the study implies that the upgrade may not be happening fast enough to stave off an impending bandwidth crunch.

  digg_url = 'http://digg.com/tech_news/TinyURL_Outage_Illustrates_the_Service_s_Risks';digg_bgcolor = '#ffffff';digg_skin = 'compact';The link shortening and redirection service TinyURLwent down apparently for hours last night (it's still down, in fact), rendering countless links broken across the web. Complaints have been particularly loud on Twitter, where long links are automatically turned to TinyURLs and complaining is easy to do, but the service is widely used in emails and web pages as well. The site claims to service 1.6 billion hits each month.There are many free public alternatives to TinyURL, some with better ancillary features (see elfurl.comfor just one example). The name TinyURLis very literal and memorable though. I use SNURLmore often, myself.It's not good when so much of the web runs through a single service. For some, politics could be a consideration as well as technical considerations. The man behind TinyURL, Keven Gilbertson, uses his hugely popular website to promote US presidential candidate Ron Paul, which I personally find somewhat distasteful, and encourages people to use TinyURL to obscure affiliate links on their webpages - which strikes me as extremely distasteful. Presumably a Paul supporter would want our redirects to run wild and free too, unbeholden to a centralized service provider capable of holding us under its thumb (I joke, but really.) URL shorteners are important because they make long links much easier to communicate. The print world could learn a thing or two from these services; InfoWorld magazine, for example, used to to publish very short redirects through infoworld.com for all links it discussed. That's great for efficiency and brand recognition and makes me wonder whether all of us ought to have our own private TinyURL service.If there was some sort of distributed standard or tool that could be good as well. The Online Computer Library Center(OCLC) has run Purl.org(Persistent Uniform Resource Locator) since the 1990's but user experience there is something only a librarian would put up with. A public institution solving this problem gracefully might be as realistic as it would have been for the Library of Congress to have acquired Del.icio.us (my fantasy) instead of Yahoo!The moral of the story, though, is that it isn't supposed to work this way. There ought not be one single point of failure that can so easily break such a big part of the web.

  According to the China Internet NetworkInformation Centerthere are 162 million Internet users in China - a number that has grown by 140 million users in just the past 7 years. 7 million of those users already call Zhanzuo.com, China's largest social network, home.The Times of Londonis reporting that Facebookhas made an $85 million offer to purchase Zhanzuo.com. The Times reports that Zhanzuo.com CEO Jack Zhang and Facebook founder Mark Zuckerberg have engaged in talks but that no deal has been completed. Facebook is denying the report.Facebook's English site already has 100,000 users in China, according to the newspaper. A purchase of Zhanzuo would give Facebook a dominant entry into one of the world's fastest growing Internet markets.Facebook, however, is denying that they have any intention to acquire Zhanzuo.com -- or any Chinese site, for that matter. Facebook's Director of Communications Brandee Barker told TechCrunchthat Facebook has not made any acquisition offers for the site. "No offer has been made and no acquisition in China is being considered by Facebook," said Barker. "And I don’t know who the spokeperson [sic] is that they are referring to in the story. The Times never contacted me or my team to confirm the accuracy of this story."

  I used to write a blog about ebooks - some of you may remember eBook Culture(alas I let the domain name slip and so it was gobbled up by a squatter). Anyway, as a lover of both books and the Web, the vision of an Internet-connected eBook Reader has been one of my obsessions over the years. And now it looks like Amazon has, finally, taken the always-nascent eBook industry to the next level. This week, wrote Steve Levy in a rapturous article in Newsweek, Amazon will release the Kindle- an e-reader that uses E Ink and will have Internet connectivity. The latter point is what will differentiate the Kindle from its chief competitor currently, the Sony eReader that was launched in 2006.Kindle image via EngadgetLevy wrote in Newsweek that the Kindle " will change the way readers read, writers write and publishers publish." He unleashes other doozies of hyperbole too: "the iPod of reading" and "the first 'always-on' book".The Kindle will cost USD399, which is $100 more than the Sony eReader. But the wireless Internet connectivity easily makes the increased price worth it. The wireless is via a system called Whispernet - which according to Newsweek is based on the EVDO broadband service offered by cell-phone carriers, allowing it to work anywhere and not just Wi-Fi hotspots. Here's Levy's description of what the device looks and feels like:"It weighs but 10.3 ounces, and unlike a laptop computer it does not run hot or make intrusive beeps. A reading device must be sharp and durable, Bezos says, and with the use of E Ink, a breakthrough technology of several years ago that mimes the clarity of a printed book, the Kindle's six-inch screen posts readable pages. The battery has to last for a while, he adds, since there's nothing sadder than a book you can't read because of electile dysfunction. (The Kindle gets as many as 30 hours of reading on a charge, and recharges in two hours.)"The Kindle will be able to hold 200 books, with new releases being offered for just $9.99. Also, apparently blogs will be part of the service - at a cost of either 99 cents or $1.99 a month per blog. Matthew Ingram was appalledthat he'd have to pay. I'm awaiting details on this, because it sounds like premium content deals have been made with the likes of paidcontent.org. Either that or Amazon will try to make money from bundling feeds. It may be attractive to mainstream people who haven't gotten into RSS Readers yet, we'll have to wait and see. Like Matthew, I wouldn't pay unless there is a 'premium' offering (in which case I would certainly consider paying).Issues: 'Ugliness", DRM, PricingThere is some debate about whether the Kindle is as beautiful as an ipod. David Rothman, who has been blogging about eBooks for much longer than me, says it's ugly. And judging from the picture above, it doesn't look like something you'd cuddle up with in bed!David also notes the DRM issues - but then you'd have to say that Steve Jobs managed to circumvent that easily enough with the iPod. Amazon has, according to Newsweek, already gotten all the major book publishers on board. As with the iPod, there are mutterings from publishers about the low pricing. But long term I would expect Amazon to do exactly as Apple did and use their market muscle to easily push forward with the low pricing and DRM.Another issue that David Rothman brings up could be the one that Amazon gets unstuck on: formats. This is a hobby horse of David, as he is a fierce advocate for an open ebook standard. He asks:"Will Amazon’s Kindle work in the future with .epub files, or will Amazon thumb its nose at the IDPF, publishers and us e-book readers who are sick, sick, sick of eBabel—all those clashing e-book formats."That's an as yet unanswered question that we'll track.Books as a ServiceWhat is most interesting though is how Jeff Bezos, Amazon founder and CEO, is positioning Kindle in relation to the e-commerce bohemoth. Yet again we hear the word "service" being conjured up: "This isn't a device, it's a service", Bezos said in Newsweek. The Kindle is being seen as "an extension of the familiar Amazon store". In other words, the Kindle is shaping up as a highly strategic move by Amazon. Probably much more important to its future business than the Web Services stack that has gotten so much (deserved) hype over the past year. Because the Kindle is literally going to change Amazon's core business model. This will take years to play out, but it all comes down to the dream that eBook fans have held for years: that books delivered electronically can offer much more flexibility, richness, search, communities, etc etc. But it all depends on having a suitable eReader device, which Amazon now claims it has created.When I wrote my 'goodbye' post for the blog eBook Culture in November 2004(yikes, is it 3 years since then already!), I noted my key themes in the eBook world: eBooks as a practice, not an object; eBooks and social networking; Remix culture (of textual content, in this case); and finding out what the various "jobs" of eBooks are in different contexts.eBook Culture logo, circa 2004I can't wait to get the Amazon Kindle, which must be a good sign that Amazon is on the right track! ;-) I think Amazon will overcome the issues that David Rothman and others have raised - they have to, because the eBook industry needs an iPod-like device and the support of a heavyweight like Amazon to finallyget traction. It has to happen with the Kindle, surely. Then we can get to exploring new business models and read/write methods of book-writing.

  Most of the comments and trackbacks from my post on LinkedInconfirmed that LinkedIn has momentum as a business social network. However some Facebook fans believe that LinkedIn is only enjoying a temporary time in the sun.For example Stowe Boyd, a man who knows a thing or two about social media, had this to say:“Bernard Lunn thinks LinkedIn is in a great spot because 80% of his contacts are there, and Facebook isn’t real for business yet. Wait six months, Bernard.”I am not sure what Stowe is predicting in six months. However I am interested in prediction markets, so how about we define a specific prediction and then revisit it in six months? If Facebook and/or LinkedIn were public companies, we could test our predictive powers in the stock market with real money. However because they are private companies (for now), we can just do this for fun and bragging rights. Anyway public companies are now all boring, predictable enterprises; we have to recreate the fun in the private markets.So the prediction, we think, from Stowe is this:“In 6 months Facebook will have more of your business contacts than LinkedIn”.We'll check back in 6 months whether that prediction comes true. But for now we'll run a poll to see whether RWW readers think LinkedIn can hold off the Facebook challenge in business networking. Please take a moment to vote in this poll:survey- Take Our Poll

  Our friends from Polldaddy, the online polling service we use here at RWW, have launched a new version of their site. The new features:New online survey tool;Addition of pro account for $20 per month - gives users more access to the site and allows removal of the link to PollDaddy in their polls;New indepth reporting on voters, voter location and IP analysis for fraud detection;Many other new little features for the polls tool, such as hiding results from voters once they have voted and ability to change the system text in the poll into foreign languages.Co-founder David Lenehan [disclosure: David is an occasional writer for RWW]told me that "the main thing about this launch is what it allows us to do in the future". The original PollDaddy, according to David, was an experiment - so the code for the original site was not built to scale. With the new version, they've re-written the entire application from the ground up. So PollDaddy version 2 is, said David, "astarting point to launch PollDaddy as a full blown professional application."So what can we expect in the future from Polldaddy? Surveys are the first new feature, and in the coming months Polldaddy will build a platform for "collecting data from the web" - which means services such as forms, quizzes, and other user-requested services. David told me that Polldaddy hopes "to build a system eventually that will ask our users what kind of data they want to collect and provide them with a selection of ways to do it."Polldaddy has 2 full time developers, including David. Their polls are registering 70 million impression per month and they seem to be the biggest online poll provider (but please let us know in the comments if you know of bigger poll services). Polldaddy has around 70,000 registered users at present. In terms of Polldaddy's integration within social networks, David said they are working on integrating with Google's OpenSocial "before Christmas." Apparently 20% of their polls are used on social network profiles. The other 80% are made up of blogs and websites, such as RWW.

  Here is a summary of the week's Web Tech action on Read/WriteWeb. For those of you reading this via our website, note that you can subscribe to the Weekly Wrapups, either via the special RSS feedor by email.Web NewsIt was a relatively quiet week in Web news, after all the kerfuffle the last couple of weeks about Google's OpenSocial and Facebook's nascent advertising network. This week Google followed up on its Mobile Web platform, Android, by putting up $10m in awards for Android Mobile Developers.In other news, online advertising was up 25% in Q3- but Marshall Kirkpatrick wondered if 80% of it is Google. Yahoo! announced a Distributed Computing Academic Program. And IBM announced this week that it will be rolling out cloud computing services for corporations in the Spring of 2008, under the name Blue Cloud.Web ProductsA Look at Mugr's Facial Recognition Platform- Josh Catone looked at Mugr, a facial recognition search site which has a developer platform. Josh also checked out the new ActiveSymbols facial recognition platformMyOffice: Full Featured Groupware Tool on Facebook- Josh has been looking for an elusive full-featured office service on Facebook. He may've found a contender here! It was follow-up to his earlier post Someone Please Build the Facebook Office.Lifestrea.ms Is Attempting to Build the Future of Life Online- Marshall Kirkpatrick profiled Lifestrea.ms, a powerful new lifestreaming service from Germany that you'll want to keep an eye on. Said Marshall: "It is a real testimony to the potential of the new web that anyone would even try to create something like this."You can find many other startup profiles in our Startups category.Analysis5 Essential Mobile Web Apps- this week we ran a contest asking you to tell us your favorite Mobile Web apps. We got over 50 comments and there were 5 Mobile Web apps that clearly stood out. Check out this post to find out which ones.Hyped New Platforms: Explaining the Difference Between One and the Other- Marshall Kirkpatrick compared 5 recent new social networking platforms: Facebook, OpenSocial, Android, Box.net, Bebo.Yahoo! Says the Future Will be Modeled on Facebook- Marshall analyzed the notion that the future of both email and start pages is in social networking. Much of the discussion, said Marshall, comes back to Facebook.Who is Blogging and Why? Is the Blogosphere in a Digestion Phase?- Alex Iskold got to the heart of the changes happening in blogging currently, with this thought-provoking post. Don't miss the comments too!You can find more R/WW analysis posts here.R/WW Network Blogslast100Check out a wrapof the week's Digital Lifestyle news on last100. Ryan Jarrett kicked off the week on last100with a post featuring six pioneers in the digital music space, ranging from David Bowie to the Arctic Monkeys. Readers were invited to submit their own pioneers, with Prince, Public Enemy and Trent Razor being notable omissions from our original list.Daniel Langendorf took NBC’s new TV catch-up service, NBC Direct, for a spin, and was unimpressed: “If you like living by network TV schedules, NBC Direct may be for you. For those of us who time shift, NBC Direct is a huge disappointment.” In digital lifestyle news, last100 editor Steve O’Hear turned his gadget lust to the Playstation 3 with its forthcoming support for DivX, and, following news that Comcast has been filtering BitTorrent traffic on its network, the P2P-based Internet TV company, Vuze, is petitioning the U.S. Federal Communications Commissionto restrict traffic throttling by Internet Service Providers.Making her debut for last100, Natalie Fonseca provided extensive coverage from GigaOm’s NewTeeVee Live, a one day conference dedicated to the emerging online video industry. Check herefor all the links.Alt Search EnginesThis week at AltSearchEngines, ten finalists for Alternative Search Engine of the Yearwere announced. Readers were encouraged to vote for their favorite finalist and at last count there were 108 comments. The Alternative Search Engine of the Year will be decided by a number of factors, only one of which is the popular vote (remember Al Gore?). The winner will be announced on Monday, December 3rd, along with the final version of the Top 100 Alternative Search Engines for 2007, and some reflections on the past twelve months by editor Charles Knight. Don't miss what will most likely be AltSearchEngines paramount post for the entire year!That's a wrap for another week! Enjoy your weekend everyone.

  A big Thanksgiving thank youto our sponsors for supporting Read/WriteWeb. We have an amazing line-up of sponsors, all supporting RWW's mission to provide quality analysis about Web Technology.Quinturauses advanced visualization techniques to enhance the search engine user experience. Check out the Quintura Cloud on our network blog AltSearchEnginesas an example (where Quintura is a lead sponsor).Hakiais a leading semantic search engine and also a lead sponsor of our AltSearchEngines site. Hakia recently released Meet Others, a social networking feature where you can meet people searching for the same topics as you.Lijitoffers excellent search tools and widgets for your blog. Using Lijit, you serve as a filter for search results for your readers. You also get detailed stats to help you understand your reader community.EtelosCRM for Google Apps is an impressive Customer Relationship Management (CRM) application that leverages the Google Apps platform. There are four editions: Personal, Professional, Enterprise, and Developer.Zohois a leading Web Office suite, with IMO the most comprehensive product range of all the online office suites. This week Zoho launcheda major upgrade to Zoho Writer, featuring Pagination Support, Headers/Footers Support, and Spell Check in 43 languages.Competeis an online competitive intelligence service that combines site metrics and search analytics in one site. Compete's recently released Search Analytics is a great way to build search marketing campaigns.Userplaneis a provider of communication software for online communities. As well as instant messaging, Webmessenger 2 has a Presence system that allows sites to display and leverage online user “presenceâ€� anywhere. Check out the new Flash-based Userlist, which lets users easily manage buddies, find online users, and launch IM’s. AdaptiveBlueis developing personalization technologies that leverage semantics and attention. Check out their SmartLinks, which we use here at RWW to display our network blogs (see sidebar). Eureksteris asearch engine that learns from the community's search behavior, so it getsbetter the more you use it. I use it myself nearly every day, to research RWW articles!MediaTempleprovides hosting for RWW - and has also been a huge help moving us from MovableType 3 to MT 4, and to a new server. So thanks (mt) and also SixApartfor that!Sponsor OpportunitiesIf you would like to enquire about sponsoring Read/WriteWeb and/or our network blogs last100, AltSearchEnginesand Read/WriteTalk, please email the editorfor a Media Kit.Pic: Elevated

  It's the weekend - another hectic week has gone by. In this era of quick news fixes, PR regurgitation on tech blogs, and the 'quantity over quality' maxim most tech publishers follow, the blogosphere usually overlooks the longer, more meaningful blog posts. So with that in mind, here are 5 'must read' blog posts from the past week on Read/WriteWeb. These are posts you may not have had time to read when they were published, but they will hopefully provide food for thought over the weekend.Hyped New Platforms: Explaining the Difference Between One and the Other- Marshall Kirkpatrick compares and analyzes 5 recent new social networking platforms: Facebook, OpenSocial, Android, Box.net, Bebo.A Look at Mugr's Facial Recognition Platform- Josh Catone looks at Mugr, a facial recognition search site which has a developer platform.Yahoo! Says the Future Will be Modeled on Facebook- Marshall analyzes the notion that the future of both email and start pages is in social networking. Much of the discussion, says Marshall, comes back to Facebook.MyOffice: Full Featured Groupware Tool on Facebook- Josh has been looking for an elusive full-featured office service on Facebook. He may've found a contender here!Who is Blogging and Why? Is the Blogosphere in a Digestion Phase?- Alex Iskold gets to the heart of the changes happening in blogging currently. Settle back with a beverage of your choice and read this, it'll get you thinking!

  In the heyday of the Facebook hype(it seems so long ago now!), Facebook was going to eat LinkedIn’s lunch. Based on recent experience, I don’t think so.I recently had reason to use LinkedIn seriously, using my existing network to tap into a market that I had not previously been exposed to. I had not used LinkedIn since the early days, so this wasmy first serious update.I have NOT used Facebook seriously. I registered out of curiosity about the phenomenon and found that the only network I could join was based on zip code - and that was useless. Then Read/WriteWeb set up a group on Facebook, but I looked once and left. When I want the Read/WriteWeb network, I go to the site itself. So please take my comments on Facebook with a large lump of salt; but Fred Wilson too has made a more determined effort to use Facebookand he has been disappointed. If there are technology entrepreneurs on Facebook, you would think they would respond to an ad from one of the leading VCs in the social media space saying “be my friend”. If Fred had used LinkedIn, he would have gotten a big response; possibly too big and that is a filtering issue that LinkedIn seems sensitive to. LinkedIn has definitely been useful for me. It is not a silver bullet, but when used with respect for real world relationships it has served one very important purpose - I can meet my objectives with the minimum of intrusion on my contacts. I can search for the contacts/companies that I want to reach and find who has a relationship and ping them for help. This is far more efficient than spamming all my contacts with a mass email saying “anybody know anybody in this role at these companies?” That would probably get a quick response but would rapidly deplete my 'relationship capital'. It is also more effective than guessing who would have the right contacts. In LinkedIn I have been constantly surprised by contacts that I would never have guessed would be useful.LinkedIn Reaches Nearly 80% of My ContactsLinkedIn links to Webmail services such as Gmail, Yahoo and AOL, which is a very effective way to increase their network scale. The Gmail link enabled me to see which contacts were already in LinkedIn and send them a request to connect via LinkedIn. Bearing in mind the 'connection pollution' problem, I was careful to only invite people who I have a real relationship with. I left out the weak connections. This also served a bit like a Plaxo update. I had old emails for people who had changed jobs; LinkedIn automatically showed me where they work now (I asssume based on email forwarding). This email link is very powerful and illustrates the point that Fred Wilson made about email systems having the most accurate social graph.Leaving out duplicates and non-business contacts, I estimate that close to 80% of my business contacts use LinkedIn. The people who were NOT in LinkedIn were either a) young or not in business, or b) older. The latter was interesting. Some of the people with the most clout and large networks accumulated over decades in business were not in LinkedIn; probably a mix of technophobia and lack of need. That’s OK, my phone still works fine :-) The key point is that around 80% of my business contacts were in LinkedIn (perhaps not 80% by valu,e given the point about senior people not being there). If other people have this experience it is pretty significant. This sounds like a network tipping point/chasm crossing, or whatever we call it now.Limitations on LinkedIn's ValueHowever there are a couple of reasons why LinkedIn - while useful - may not become a highly valuable business. There are rumors they are looking at an IPO, so then we will find out the real numbers. Until then, here are two observations that indicate limitations on valuation:1. LinkedIn mirrors real world relationships but does not change them. I assume the same is true on Facebook. More to the point, attempts to use LinkedIn to change real world relationships can be counterproductive. I found a few people who seemed as if they were almost “professional” LinkedIn users. Their names came up constantly as connections. They had 500+ connections (LinkedIn shows the number of connections but only says “500+” above 500, so the person could have 5,000 connections). Most of those are bound to be weak connections. One example; somebody who contacted me by email years ago, it was not of interest to me but I must have responded to his LinkedIn request to connect. I really did not know this person. Another example; somebody I know well, but when I tried to use the connections he told me that during a job search period he'd networked relentlessly and entered every random contact into LinkedIn. He had effectively made his LinkedIn connections useless by 'pollution'. 2. I can bye-pass the network and avoid paying the fees. The 'professional' users of LinkedIn tend to be sales people or recruiters. In other words people who network for a living. They are the ones who will pay the fees that LinkedIn charges:Monthly cost$19.95$50$200Request Introductions15 at a time25 at a time40 at a timeContact users directly through InMail3 per month10 per month50 per monthLinkedIn Network search results100150200The problem is that 'reciprocity' (aka what goes around comes around; or you scratch my back and I'll scratch yours) is missing. Sales guys sell, they don’t buy. If they simply use LinkedIn as a glorified marketing database, people will put up the barriers. I contacted some people through LinkedIn’s built in messaging, but more often I reached out by email or phone. This was not only, or even primarily, induced by a cheapskate desire to avoid paying the fees. Sending a standardized mail through LinkedIn seemed like a cold and impersonal way to re-establish a relationship and ask for a favor. So I am not sure how viable the subscription revenue business will be. Which leaves advertising. If they go for something similar to the Facebook ad model, that would go down like a lead balloon in this business community. It is possible that LinkedIn has the 'magic monetizer', the Adsense equivalent that turned a useful service into $ billions in revenue. I just have not seen it yet.Where to now for LinkedIn?Linked In has some of the smartest investors around(one of the angel investors is also an investor in Facebook). These investors have deep pockets and they are almost certainly following the model of building both scale and deep end user value before attempting too much monetization.I have seen signs that they are looking at deepening their service value, specifically by becoming a network to find small service providers. With reputation ratings, that has big value. It has reciprocity as there are times as a buyer when you really need a small, specialist firm at short notice. So this is valuable to buyers as well as sellers. There are specialist networks doing this already, so LinkedIn can do it at scale across multiple domains. That looks like a winner. Thinking about monetization, I looked at the primary motivations for using a business networking service like LinkedIn:1. Push marketing. Find the right contacts to avoid cold call. This has limits. Over-use will lead to barriers getting erected to avoid 'networking spam'. This is true whether one is selling a product, a service or person (e.g. recruiters). This works when it is occasional, uses close contacts only and there is reciprocity in the real world relationship.2. Pull markerting. Put up your profile, or your firm’s profile, and get found by the right buyers. This is nascent in LinkedIn today but shows big promise. 3. Just-in-time expert advice for cash. This is what companies like Gerson Lehman Grouphave done for years and they have built a real business. There are more consumer-oriented variants such as BitWine. With their scale, LinkedIn could easily get into this business. RELATED POSTS:LinkedIn and The Impending Challenge of Facebook, by Alex IskoldLinkedIn to Open Up - How It Can Take On Facebook, by Richard MacManusThe Social Networking Faceoff, by Alex Iskold

  The US real estate market may have fallen on hard times recently, but people still need to live somewhere. As a result, the rental market has recently experienced a revival, as many home owners who can't sell are being forced to become landlords to make mortgage and tax payments. Over 90% of the residential property rental market is controlled by small time owners -- i.e., those with under 50 units.These people are often small investors or casual landlords who do not have the resources to easily keep track of tenants, bills, expenses, advertising, etc. Investment Instruments is a web application provider that creates tools that make life a lot easier for small time landlords. Their premier tool is iiProperty, a full management suite for rental property owners.iiProperty is designed for people who manage between 1 and 55 units, and is built on Ruby on Rails. The management application handles a lot of the legwork of being a landlord. From tracking rental and tenant info, to automatic tenant billing and managing expenses (the service can even send out notices via postal mail to tenants), to cashflow and tax reports. iiProperty also handles the PR front, by letting users design and post "for rent" ads to popular web sites like Craigslist or Oodle. It's something like vFlyer, but focused on real estate.Where iiProperty really excels it taking the legwork out of being a landlord and keeping real estate investors on top of their properties. If one of your tenants is late on a payment, for example, iiProperty will let you know; if a lease is expiring soon, iiProperty will make sure you're kept aware. The application also lets landlords with multiple properties create a public-facing web site to help advertise their rentals (see an example).iiProperty ranges in price from free (for one unit) to $64.99/month for landlords who have more to manage.Investment Instruments also operates a consumer-facing rental site, Rentometer. I was very excited to see Rentometer, because something like it was one of the first ideas I had for the Facebook platform when it was launched last Spring. Little did I know that someone had already created my idea -- albeit not in Facebook (though Rentometer offers up their data through an API, so theoretically, someone could port the site to Facebook fairly easily).Rentometer is a painfully simple site that lets you check the price you're paying for rent against the median price for your area. The site gathers data from major public rental listings databases (like Craigslist, Rent.com and other classifieds sites) and mashes them up with Google Maps. iiProperty President Owen Johnson told me that the site probably has in the tens of millions of records -- that's a lot of rental data.Rentometer publishes a weekly report of the highest cost rental markets in the US. I'm sorry to inform that for last week, our friends in the Valley topped the listby a wide margin. The site also periodically releases rental reports for major college areas to help students not to get ripped off while renting an apartment or house. Below is a screenshot from the Rentometer report released for New York University this fall.

  digg_url = 'http://www.digg.com/playable_web_games/Moola_Opens_Massively_Multiplayer_Rewards_Game_to_Public';digg_bgcolor = '#ffffff';digg_skin = 'compact';Toronto, Canada-based Moolahas been operating an invite-only beta for a little over 18 months and will on Friday open their site to the public (they'll be officially launching at the TechCrunch Meetup in Boston). Moola has created a multiplayer online game network in which people compete head-to-head for real money. That's nothing new, but Moola's hook is that the site is completely free. You can't deposit money into Moola, instead you earn your starting funds by looking at ads before playing games. Moola is calling their creation a Massively Multiplayer Rewards Game (MMRG).Here's how it works: Moola fronts users a penny to start, which puts you at the bottom rung of a thirty step ladder. Every time you win a game, you double your money, every time you lose, you fall all the way to the bottom and start over with a penny. If you win 30 times in a row, you walk away with $10.7 million (though you can cash out at any time, so risking a few thousand in an online head-to-head game at the middle levels is probably not that smart).Moola has grown to 175,000 users since it launched the invite-only beta in 2006. Moola CEO Arlen Ritchie told me that recently the site has been getting a lot more traffic to their home page than they have registered users, which indicated that there is interest from people who don't have invites. So, now seemed like the perfect time to open the doors to the site.Ritchie acknowledged that it is unlikely anyone will ever win the $10 million prize because most people wouldn't be crazy enough to risk $5 million to try for it -- in fact, twopeople would have to be that crazy. Of course, you don't have to wager it all on each game. You can play in any bracket below your account balance, and Ritchie told me that most people keep a positive balance rather than wagering all their cash at once. And even if winning the big one may never happen, a lot of real money is being made on Moola. The top player right now has over $8,000 and the highest cash out was in the $5,500 range. Users on the site have exchanged over $4 million so far (though that figure may count the same money being traded back and forth between users multiple times and doesn't represent the amount paid out).Because it is unlikely anyone will make big money from the games, most users will either stay in a low game bracket (a few cents), which the ads will cover for Moola, or they will make money via Moola's other options -- at which Moola always makes money.Other Ways to Make MoolaIn addition to games, Moola enables users to make money by searching on their Moola Searchpage. Powered by Google Custom Search, Moola employs an algorithm that measures how much people search, weeds out illegitimate searches and clicks, and then shares ad revenue with searchers. You might only make a few pennies per day, but that money can be used to play Moola games and bump you into a higher playing bracket.Moola also lets people make cash via what they call "Boosters" -- or, a cash back program based on affiliate marketing. Shopping at any of Booster's affiliated online stores results in cash deposited in your account. Moola supports a lot of major online retailers including Hotels.com, Buy.com, Travelocity, Skype, Old Navy, and NewEgg.The final way Moola enables users to make money, is via a 4-level referral program. Refer friends, and take a cut of anything they do on the site, whether that's search payouts, Booster Zone payouts, or game winnings.BoosterBarAlong with opening the site to the public, Moola will be announcing a toolbar that is really centered around their shopping and search revenue streams. They've built the Moola search into the bar, which makes it more convenient for people. It is the slick shopping integration, however, that will garner more interest. Any site you visit on the Internet that is a Moola affiliate will register on the bar and allow you to log into your account so your shopping is eligible for cash back. That lets people shop on the web as normal, rather than have to first page through the site's directory of affiliates -- something Moola expects most people aren't keen on doing.If an ecommerce site is not a Moola partner, the BoosterBar will suggest an alternative that is in their affiliate network. Ritchie tells me that initial feedback from partners on this feature is tremendous. They love being able to steal visitors away from competition right at the point of sale.Eventually, the game playing side of Moola will be integrated into the toolbar, allowing users to set up games and then surf the web while waiting for an opponent -- which can take longer at the higher levels where competition is more thin. Ritchie told me that the plan down the line is to add social features, such as chat or messaging, to the toolbar to augment the community that has grown up around Moola. Apparently, some users have taken to organizing their own tournaments based around Moola's games (you can set up one-on-one matches with specific players on the site).The GamesFor the cornerstone of the site, the games are rather weak. Moola has created three proprietary games for the site, with a fourth currently in development. Moola's line up includes a rock, paper, scissors game (*yawn*), Hi-Lo (*yawn*), and a bidding game where you try to out smart your opponent (not the most thrilling experience, but it held my attention longer than the others). But, Moola is in the planning stages of an API that would allow third-party developers to add games to Moola. They're currently in talks with two unnamed developers to create additional content prior to the release of a public API. (And they are soliciting queries from other interested game developers at gamedev@moola.com.)Moola developers would be able to make money from both the advertising on the games, as well as take a cut of the money that changes hands between players. Ritchie also told me that the plan is to allow developers to "Moola-ize" their games outside of the site. So, for example, Microsoft could add Moola functionality to Halo 3 on XBox Live and then Moola members could organize Halo matches and play each other for cash.ConclusionNothing at Moola is very revolutionary. Cash back shopping? Seen it. Competitive gaming? Seen it. Revenue share on search? Seen it. Multilevel referral program? Seen it. But they appear to have packaged everything up in a tidy manner, and the coming API for games is exciting. Winning money playing online games without putting any of your own cash up makes it a lot more fun (I'm up to $0.22 -- time to retire!), and the prospect of less snooze-worthy games from third-party developers sounds great.It took Moola members 10 months to play for the first $1 million. The last million took about 4 months. The next million is on track to cross through Moola in just 55 days. Once the site opens up, those millions will probably be flying about at a more rapid rate.