Valuing Social Networking Sites

Dot-Com Bubble, Part II? Why It’s So Hard to Value Social Networking Sites – Knowledge@Wharton: An interesting article from Knowledge@wharton about determining valuation for social networking sites.

“Metrick believes social networking sites will not be a passing fad. But there’s no guarantee that MySpace, Facebook or any of the other current players will be the big winners in the end. Fader, too, believes social networking is here to stay, but he thinks it may work best not as a freestanding function but as an additional feature on sites that draw users for other reasons. Hence, the winners may turn out to be other sites that adopt social networking features. Or they may be new players, or current networking sites that broaden their offerings.”

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