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Social Networking experiments gone awry
By Brian Jackson
With Facebook’s valuation approaching $100 billion, Twitter somewhere between $3 and $10 billion, and LinkedIn’s IPO skyrocketing its valuation up around $10 billion, you might think that operating a social network is a licence to print money these days. But the social networking business model of providing a free service and drawing in a wide audience isn’t always easy to monetize. If advertisers don’t buy in and users aren’t willing to pay for premium content, a social networking site could quickly find itself in serious debt with no light at the end of the tunnel. Here’s 10 social networking experiments that may have enjoyed some time in the lime light, but eventually met their demise.
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Sprouter
Despite gaining an enthusiastic following among entrepreneurs both in Canada and abroad, Sprouter had to close its doors Aug. 2. “We’re devastated to have to shut down the service but unfortunately, due to capital constraints, we’ve simply run out of options,” site founder and CEO Sarah Prevette wrote in a blog post. Sprouter first introduced itself to the global startup community as a Twitter-style messaging service for entrepreneurs. In March, Sprouter reworked its service to provide a question and answer-style service giving access to many business experts.
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MySpace
When News Corp. bought MySpace for a $580 million in 2005, it looked like it was on its way to the top of the Web. It even proved to be a sound business investment when Google signed a $900 million agreement to place ads on the site a year later. But with the rise of popularity of Facebook, the so-called “MySpace” generation suddenly had a new favourite online hangout. MySpace was sold to Specific Media for just $35 million, with pop star Justin Timberlake taking a claim in the business. That makes sense, as MySpace’s remaining user base are mainly music fans and bands looking for free promotion.
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iTunes’ Ping
Steve jobs may want you to think that everything Apple launches is “magical” but it would take a real magician to turn that trick when it comes to Ping. The social network integrated into iTunes was announced Sept. 1, 2010 along with iTunes v10. Despite launching with 1 million members in 23 countries, the service ran into problems almost immediately. Jobs demonstrated Facebook integration with Ping, but that was removed before launch. Spammers also took advantage of the service with 24 hours of its launch, with malicious comments crammed into the pages of popular artists such as Lady Gaga. Apple may already be looking to move on, recently filing a patent for a social network based around the iPhone.
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Google Buzz
Google+ isn’t the search giant’s first attempt at tying all its services together through a social portal. It launched Buzz in February 2010, but there was soon a privacy backlash when Buzz made certain Gmail information public. Google may have merely upgraded the Buzz infrastructure to Google+. Buzz users recently trying to delete their accounts were instead taken to a page to delete their Google+ profile. It seems a bit suspicious that “Disable Google Buzz” would lead to “Delete Google+ content” unless the two are really one and the same.
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Yahoo! Buzz
Launched in February 2008, Yahoo was the first to launch a social networking service with the name “Buzz.” It also killed the service first, taking it offline on April 19 this year. In the style of Digg, Yahoo’s Buzz encouraged users to share links to original news articles and include a brief snippet of their own content. The more a link was voted for, the higher its Buzz Score and the more likely it’d show up on Yahoo’s homepage. The service was dumped because Yahoo is trying to focus on its core competencies to improve business – what a buzz kill.
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Friendster
Originally launched as one of the pioneer social networks in Morgan Hill, Calif. by Jonathan Abrams and Peter Chin in 2002, Friendster wanted to make it easier and safer to meet people online. It attracted 3 million users in the first several months. Though it at one time had more than 115 million registered users, its expansion in North America was derailed in 2009 by Facebook’s popularity. Today, the Friendster.com domain is owned by MOL Global, self-described as one of Southeast Asia’s largest Internet companies and owner of a payment service provider and Friendster. It’s shifted Friendster’s focus toward young Asians around the world as a social gaming and music platform.
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Eons.com
Eons was originally launched as a social network for U.S. residents over the age of 50 by Monster.com founder Jeffrey Taylor in July 2006. Despite raising $32 million investment capital from the likes of Sequoia and General Catalyst Partners, the baby boomer-focused site never really gained traction. In September, 2007 Eons shed about half its staff members. Today, the domain limps on but is open to anyone over the age of 13. But it’s unlikely teenagers would be drawn to the site’s obituary feature and funeral home advertisements.
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Wal-Mart’s The Hub
It took just 10 weeks in 2006 for America’s largest retailer to both launch and shut down its MySpace-style social network targeting teens. Marketed as a “School Your Way” promotion, Wal-Mart envisioned youth connecting around the store’s products. But the site turned off teens by sending user information to parents for approval, and loading the site with fake profiles that were thinly-veiled pitches to shop at the mega store. The site was also crammed full of advertisements.
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Google Wave
Google Wave launched as the search giant’s first foray into the social space in late 2009. Features like character-by-character live typing, the ability to drag-and-drop files from the desktop, and a “playback” feature to show the history of chances promised some interesting ways to communicate and collaborate. But Wave proved too different to gain much traction, never reaching the critical mass required to make it a killer app for collaboration. Google’s Wave came crashing down Aug. 4, 2010. But an open source version lives on at The Apache Software Foundation.
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Akoha
This Montreal-based social network launched in 2008 had a real-world aspect to it as well. It encouraged users to do good deeds in the real world in order to score points with the online community. Decks of original Akoha collector’s cards were circulated issuing missions such as “calculate your carbon footprint.” Despite once being recognized as one of Canada’s most innovative companies by the Canadian Innovation Exchange, Akoha announced on Aug. 1 that its Web site will be going offline Aug. 15. “We weren’t able to generate enough revenue to cover our expenses so we’re left with no other choice,” the company wrote in an e-mail sent out to all users.
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