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Many email sites such as yahoo, gmail, and hotmail have not been able to generate a significant revenue base for offering such services. Likewise social networking sites such as facebook and orkut may find it difficult to generate sizeable income from such ventures. Microsoft’s takeover bid illustrates the point that Yahoo may be failing to adequately profit from its online services. Some may argue that founder and CEO of Yahoo, Jerry Yang, was crazy not to accept Microsoft’s $44 billion dollar offer, because there are many challenges to earning a decent revenue base from certain online sites. Once facebook becomes too commercial with an abundance of online advertisers, viewers may move on to the next best thing. Charging people to use the service, is also a deterrent and so ad revenue is a more legitimate way to monetize social networking websites.
Providers of social networking sites find it a challenge to offer the service and yet profit from them. As soon as they start charging for services, people move on to a competitors network. It would be interesting to see what is in store for the future of social web sites, web portals and Internet Technology. If Microsoft takes over Yahoo, I fear that this would be anti-competitive and not to the benefit of Internet Users. Microsoft has a trend of being too business savvy and concentrating on their bottom line, then on the best interests of society.
