Bloggers were like the free radio disk jockeys in the 70’s
Once upon a time in the seventies the record labels controlled the music business.
They owned the rock groups that needed money for producing the albums.
Once upon a time during the Web 2.0 era start-ups got funded by Venture Capitalists.
VC’s owned start-ups as they controlled the companies.
Disk jockeys for getting hits
They paid pluggers to promote the records of their rock groups to disk jockeys of the pirate (offshore) radio’s that broadcasted their radio shows from boats anchored in the North Sea.
Pirate radio stations and their disk jockeys were immensely popular due to the popular songs they played, whereas the national radio stations played less popular (then decent) music.
The disk jockeys played the plugged music, entered them into the music charts and the songs became a hit.
This generated mainly money for the record companies.
Bloggers for getting hits
The new web services of the startups needed to be promoted to the public else nobody except a few geeks and nerds would use them.
Instead of using expensive advertising, the VC’s wanted to influence the bloggers: the more famous the better (ReadWriteWeb, TechCrunch, VentureBeat, GigaOm, …)
Bloggers instead of journalists, as bloggers were more popular than journalists and could address the target public online.
Thus VC’s engaged people who could promote the function, features and the coolness of Web 2.0 services to the most influential bloggers.
The bloggers wrote about the cool new Web 2.0 service and people signed up for a free web service.
As the number of users increased, more bloggers wrote about the new phenomenon or hype (myspace, Flickr, Facebook, Twitter, …).
As a result even more people signed up.
The valuation of the start-up increased and the VC could sell the shares to a major company that acquired the start-up for different reasons (not for the profitable business).
This generated mainly money for the VC.
Credit Crunch killed the Start-up Star
As change is the only constant in life:
Music business change:
- The music business changed, as the role of promoting music was taken over by the disco’s, which became more important as influencers.
- A few years later the video killed the radio star completely.
VC business change:
- The Web 2.0 business changed as funding dried up induced by the Credit Crisis/Crunch and faulty CDO’s (Collateralized Debt Obligation).
Thus no more successful IPO’s or acquisitions by larger companies of the venture backed startups.
- The hyping had created already too many web services, requiring shutting down many of the newly acquired start-ups as revenue, profit and users were lacking.
- The decline of online advertising was driving the income of bloggers down.
- Start-ups needed less funding as technology made developing and operating web services cheap compared to marketing and advertising costs.
Will bloggers become employees just like the disk jockeys?
The pirate radio’s disappeared and some got licenses the broadcast from mainland.
The radio disk jockeys became less popular as their pirate image was taken away while working for a land based radio as an employee – playing the same popular music as the national radios.
Will bloggers just become paid writers who are part of the team writing for popular blogs that are overtaking (killing) the printed newspapers?
Or will the online advertising model further fail and make living from blogging impossible?
What will become of the bloggers?
What or who will influence people and decision makers in the future?
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