Widgets and Applications, is there gold at the end of the rainbow?
With Facebook and Bebo opening their API and MySpace and LinkedIn allegedly soon to follow, companies are scrambling to form and develop applications and widgets for social networking sites.
Over the last few weeks I have read a few different articles and perspectives about the booming interest in making widgets for facebook and other social networking sites. With the announcement that MySpace.com is about to open up their site to outside programmers, some companies have scrambled to form and look for venture capit0l. This article from Reherring.com talks about the idea that these sites are now platforms, not just social networking sites. Developers expect that these widgets and applications will be to be monetized in a short time, which is getting developers scrambling to come up with different applications and gain a foothold.
“There are a number of applications spreading virally very fast,” he said. “A lot of them aren’t monetizable, at least not yet. Going forward, the applications will not be the fun, simple applications people are using now. They will be monetizable in the same way web 2.0 sites are monetizable. Some are just toys. Others are very highly monetizable.”
Not only are people seeing that this could be profitable, experts believe that this is going to lead to a full scale change in the idea of social networking. With these applications, the combinations will be endless, allowing the user to define their social networking experience. In a recent San Jose Mercury News article, they were referred to as “living organisms”.
“If Facebook is successful, the social-network sites of today will be obsolete,” said Salil Deshpande, a partner at the venture firm Bay Partners, which this month promised to invest between $25,000 and $250,000 in up to 50 companies developing applications. “It is something quite monumental.”
Sean Carton believes that widgets and applications are going to be the newest and most successful form of online advertising. Because widgets and applications offer some things that traditional advertising doesn’t:
- They are unintrusive
- People want to use them
- They can be branded
Essentially users will be selecting items and features they want on their pages, with that specific application being sponsored and providing exposure for the advertiser. If you don’t believe that this is a successful business model, just take a look at the ability to Simponsize your MySpace profile picture.
The next year will really show in what direction social networking is going to go and how opening up these social networking sites will impact their business model. Will social networking sites charge these application makers to develop applications for their sites? Will they charge them to brand them? In the long run I can’t see MySpace giving away free advertising to widget makers.
Where do you think this will go?
Technorati Tags: Social networking, MySpace, Facebook, Widgets
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6 opinions for Widgets and Applications, is there gold at the end of the rainbow?
Scott Allen
Aug 20, 2007 at 7:37 am
Interesting point about monetization. One capability that comes with monetizing widgets is the potential for CPM revenue, not just CPC — that’s traditionally not been available to smaller publishers, much less to stick on your social networking page. Last week, I just discovered a cool new widget that embeds a Flash video player of news stories in your site. You can either hand-pick them or choose one of their existing topical feeds.
I have three examples you can check out:
MySpace news on my MySpace profile
Social networking news on one of my blogs
Internet marketing and e-commerce news on another
Scott Allen
Aug 20, 2007 at 7:38 am
Oh yeah — another cool point about it… it’s viral and a 2-tiered affiliate payout. If someone wants to run one of the stories in your player on their site, they just click the “Mash” button and instantly get the code to do so. And then you get a small portion of whatever they make. How cool is that?
SEO Blog
Aug 20, 2007 at 5:40 pm
Thanks for visiting the SEO Practices Blog. Nice set of blog you got there…
Social Media has become a very important tool for marketing, it’s of course a different way of doing it, in social media we talk about pull marketing instead of push marketing.
I’ll see you around.
Kevin
Aug 21, 2007 at 3:48 am
Scott that widget looks pretty sweet, I am going to play around with it a bit today.
Abhishek
Aug 21, 2007 at 8:17 am
Kevin,
You have asked an excellent question here. I believe widgets are slowly becoming mainstream and people are gradually figuring out ways to monetize. They did start out as toys with offering transient information.
However now they are gaining mainstream presence by adoption from some of the big boys. Also I do think that monetization options with widgets are far greater than using RSS. I am hoping that content publishers and media houses realize the power of widgets and start using them as real channels for distribution of information.
Here are some of my thoughts on the matter:
http://abhishek.tiwari.com/2007/08/21/its-a-wild-widget-world/
Graham
Aug 23, 2007 at 1:39 pm
Probably if people keep signing up at these social networking sites..
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