From a usability point of view, as someone who has been beta-testing Socialthing.com for awhile (post your email address in a comment if you want an invite) there are a couple of key differences between it and Friendfeed, which I’m a big fan of (my feed is here). While Socialthing is well-designed for the most part, one of the biggest differences that becomes obvious is that Socialthing groups activity in your “friendstream” by individual — so next to each friend’s avatar you see what they have done on Twitter or Flickr or whatever, grouped together. In FriendFeed, however, you see a river of activity based around the events themselves, so that you see a stream of whatever your friends are doing that is grouped by time rather than identity.
Obviously, an exit that is in the $25-million range (according to Mike Arrington) is nothing to sneeze at. But will it help Sphere to be part of an online venture that is still trying to remake itself, and is part of a gigantic media conglomerate — a conglomerate that may or may not have a commitment to the company longer term? I’m not so sure. I hope that the company’s advisors, who have included Toni Schneider and Matt Mullenweg of Automattic, are guiding the company in the right direction (Toni Schneider certainly seems to think it is).
As Kara Swisher says, it would be a shame if Sphere were to “fall into one of the dark holes” over at AOL, since Tony and his team seem like a great group. Before I added the Sphere plugin to my blog, I tore a strip off the company’s blog search for being irrelevant — and Tony not only took it in stride, but listened to the criticism and the service got better. I wish them nothing but the best, and I hope that AOL is it.
My friend Paul Kedrosky said that it was like tying two rocks together to see if they could fly better than one, to which I responded that to compare AOL with a rock was unfair to rocks. But another friend — Stuart MacDonald of Tripharbor.com — probably said it most succinctly: Yahoo + AOL = FAIL. I realize that Jerry Yang and the board of directors have to “pursue all available alternatives,” or whatever it says in the fiduciary duty documents, but this is ridiculous. The next thing we’ll hear is that Yahoo is talking with my Aunt Edna’s bridge club about a counter-offer.
Does Time Warner want to somehow get rid of AOL, preferably without losing an even bigger pantload of money than it has already flushed away? Sure it does. And on the surface, merging with Yahoo probably seems like a super idea for TW. But what exactly does it buy Yahoo? Some cash to do a share buyback, apparently, according to the Wall Street Journal. Whoop-de-doo. If shareholders of Yahoo vote for a shotgun marriage like that, they deserve whatever they get.
Obviously, Yahoo has to cozy up to just about anyone (even Disney, apparently) in order to try and get Microsoft to jack up its offer from what the Web company believes is an insulting $44-billion or so. Like my friend Paul Kedrosky, I think Yahoo is going through the corporate-takeover equivalent of Elizabeth Kubler-Ross’s classic stages of grief — anger, denial, bargaining, etc. Right now it’s stuck in bargaining.
Fiduciary duty obviously compels the Yahoo board to fight the Microbeast, but it still seems somewhat futile. I hope Jerry Yang doesn’t try to actually float the idea that a merger with AOL would be a good thing for Yahoo — the howls of laughter would drown him out. Better for Yahoo to suck on a tailpipe out in the corporate garage than succumb to that. Rafat Ali at PaidContent says it’s pretty unlikely that Time Warner would do it, and Ashkan at HipMojo doesn’t think it’s too likely either.
Strategic choices? At this point, the only strategic choice for Time-Warner when it comes to AOL is the choice between whether to use a .45 pistol or a shotgun to administer the killing blow. I realize that when you’re a big-time CEO running a gigantic corporation with many moving parts, you can’t just come out and say “We are selling this dog,” but come on — everyone has to know that this is coming, right? AOL has been shedding subscribers by the millions every quarter for as long as I can remember. The access business is dying, and the body has already begun to smell bad.
If anything, the death of the access unit is the easy part. Sell it for parts to an income fund or someone who wants to play the declining margins game, and then move on. But the content business is a bit more problematic, as Cynthia Brumfield wisely points out at IPDemocracy. Although the shift from walled garden to free and advertising-supported content has been a relative success for the company — in the sense that advertising revenue has been growing — it still hasn’t come close to making up for the revenue that AOL gave up by making the shift.