The MySpace networking/media sharing/something-or-other web-based outfit is reported to have lost 10 million users between January and February of this year. I sympathize; I’d hate that to happen to THE CINCH REVIEW. (Fortunately our numbers are continuing to trend strong here.) A story in the U.K. Telegraph includes this factoid:
News Corporation bought MySpace for $580m (£373m) in 2008. The asset was briefly valued at $12bn when News Corp attempted to merge it with Yahoo in 2007.
This is a little bit of a tired old hobby-horse for me — although not necessarily in print before now — but: When the hell are people going to learn not to place such absurd value on these ephemeral internet entities?
Remember when AOL was the biggest company in the world (just about) and believed to have a gi-normously impossible-to-conceive and incredibly profitable future ahead of it? Yet, all it amounted to was one single way for people to dial up and get on the internet! Is it so shocking that when people realized there were many other ways to get online, many preferable and cheaper, they simply clicked the “X” in the upper right corner and ditched AOL for good? Why did it ever have such perceived value?
How bluntly can it be put? There is no loyalty when it comes to people clicking some stuff on their computer or other gadget. Something else comes along that seems a little easier or more appealing, and people choose to click around on that instead. They turn on a dime. What is being sold — and this goes for Facebook and Twitter and all the current crop of favored online things — is lighter than air. Heavens! We might come up with some cool new twist on social networking at THE CINCH REVIEW next week, and millions of Facebook users would simply forget that boring old site and spend their time here instead. Wham! 50 billion dollars gone. But it was never there to begin with. Was it?
Clearly, I’m no economist. They are the ones who can explain why it was perfectly legitimate for AOL to be — for about a year — the hugest thing since General Electric, or why it was perfectly sensible for MySpace to be fleetingly valued at $12 billion.
I’ll just go back to tinkering with this idea for a proprietary CINCH REVIEW social networking thingummybob. Maybe roll it out here in April. (If you have a million or so in spare cash, would it be terribly indiscreet to just say ground floor opportunity?)