Searching for "Web 2.0 bubble" on Google returns over 64,000 results, including numerous hits from blogs, major newspapers like San Jose Mercury News and many other sites. According to this ZDNet blogpost of a few days ago, more than 55% of video streams on the web is dominated by the top 10 sites yet many more video-sharing sites have been created. The revenue model is fundamentally the same with slight variations of when and where to insert ads. The picture isn't that different in photo-sharing sites where once again tons of sites are competing for much of the same user base with similar business models. I'm not holding my breath for another multi-billion dollar acquisition in this space.
According to an eMarketer study published on September 2006, online ad spending slowed down to less than 30% this year (after growing more than 30%, two years in a row). It's impossible to imagine all these start-ups succeeding. Yes, Web 2.0 is much more than photo- or video-sharing; but these segments clearly exhibit the signs of a bubble - and originality has suffered as a result. Intensely competing for similar customers with undifferentiated revenue models doesn't seem like a recipe for success (Full disclosure: I have invested in companies that target video advertising in different ways, so I'm playing my bet differently in this space). Hence my excitement when I come across a truly original idea, especially one that actually solves a recurring problem.
A great example is Remote Control Mail covered by Marshall Kirkpatrick on Techcrunch on November 22. Here's an application that would be so useful for so many of us constantly crunched for time or often on the road. Dealing with junkmail is one of those drudgeries of life none of us enjoy. Issues like privacy and accuracy will probably concern new users for Remote Control Mail - yet the idea of outsourcing junkmail handling and regular postal mail processing to someone else is very interesting (even at an activation fee of $25 and monthly fees of $19.99).
No need to ask Santa for a nice gift this Holiday season: the chance to back new, original start-up ideas with passionate teams would be just fine.
