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Place Your Bet on Ad-Driven Social Networking Sites, Or Not

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Social Networking Sites

The Bang

Online social networking giants such as Facebook and MySpace have become part of a cultural phenomenon. Increasingly, these sites are turning into the de facto way for people to keep in touch with friends, family, and even strangers. A report published by Datamonitor estimates revenues in social networking sites will reach US$2.4 billion by 2012.

As social media grabs an increasingly larger share of online time, Joe Chen, chairman and CEO of Beijing-based Oak Pacific Interactive, envisions that individuals will use social networking sites as their one-stop destination to handle personal tasks. For example, users will leverage their online social network as a personal portal to send messages, look for a new job, manage personal calendars, check out potential dates, and/or play social games with other online users.

According to Asian Venture Capital Journal (AVCJ), industry experts predict that online social networks will prosper during the current depressed economic cycle as people look for less costly ways to amuse themselves. In China, for instance, teenagers can play online games in Internet cafes all day for only RMB 10, or about US$1.50.

But does this flurry of activity translate into a good investment opportunity for you?

The Bang | The Dang | The Game | Business Models | Take Away

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* Please be civilized. Comments that include ad hominem attacks or destructive criticism will be removed.

  • cirereyes
    I think I will not invest that much on social networking sites. For me, social networking sites are just a fad that will continue to go on as long as it is still “in”. I’m sure someone will be able to come up with a new idea that is better than these sites and that will surely put an end to this trend.
  • Agreed, especially since the industry is increasingly fragmented and niche social networking sites are popping up by the minute. Unless new entrants enter the field with some sort of industry disrupting factors that aren't easily duplicated by others, their chance of capturing a big enough market share and generating a handsome return for investors is unlikely.
  • Kejatz
    And that is why my friend I will stay up to date on all new "hips and stuff" :) because if you want to be on marketing crest of a wave you need to be acquainted and learn constantly about all innovations.
  • Kejatz
    Although I support and uphold the Internet as one of the most powerful mediums today it should not become a primary mean and place how and where people will live their lives. But, for marketing and earning purposes it is a paradise!
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