May 08, 2006

The Blogging Trend - How do we capitalize?

Off the top - here is the list of stocks I own and watch as it relates to the blogging world. I am looking for more. Please share your ideas.

Google
Apple - own
Adobe - own
Akamai - own
Symantec
McAfee

I have been thinking about an in depth article and sort of piling up articles on the subject and today was inspired to complete it by another great Chartreuse post .

I am no tech expert so this is just one guy's thoughts gleaned from reading hopefully smart people that I frequent their thoughts. If they are wrong, I too will somehow be wrong as an extension.

I would like to get into my thinking and hopefully begin a conversation over time.

The media stocks like News Corp, Time Warner, Yahoo and even Microsoft are not in my list. They could be there but they are too diversified for me to capture the growth.

As others have called for a bubble, I have long called inning one. If it is inning one, that means I can make some major retirement money. Inning one means I can make some mistakes but if I stay in the game, there will be plenty of fat pitches to hit. Inning one means there are 9 innings left time for big leads, come from behind drama, errors, foul balls, home runs, singles - you get the point.

I make one assumption for my analysis - I consider the social networking sites in my market universe for blogging. I believe we are finally well into the trend of the power of one.

Therefore, the first home run in the blogging/social networking space is MySpace - at least for their shareholders.

The MySpace purchase has created a rush of copycats like Facebook and MyYearbook that have latched onto the multiple expansion in blogging/social networking. At a time when Google has cast a multiple expansion across more mature internet businesses, it has become hip to be viral and new - and worth ahigher multiple.

Multiple expansion attracts, deals, bankers, money, greed and ultimately (quickly in the 21st century) lot's of huge ugly mistakes.

Right now, the big ugly disasters taking shape are in video aggregation services. That is a tough one to handicap with new entrants everyday. YouTube is the early leader and they are SPENDING money. The big winner here looks to be bandwith and cacheing providers like Akamai. I will stick with my Akamai. Nicholas Carr has an insightful piece on how this shapes up . I post it because I agree.

Lot's more to come in a bit. I am off to Game 1 of Suns/Clippers.

Comments:
I agree that wrt video aggregation services the real winners will be the bandwidth/cacheing providers.

What's your thinking with Adobe? It doesn't fit the mold of power of 1, blogging world, .......
 
Adobe makes tools that amateurs will need for their blogs and files, pdf's, video editing tools etc..
 
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