Blogs Don't Bubble Like Stocks and Housing

Posted on May 25, 2005

USA Today has a new article by Kevin Maney that compares blogs to a bubble:

These days, the hype about blogs is off the charts.

And you know what that usually means: Run for cover, because a bubble is going to burst and make a big mess.

Just about everybody is either celebrating blogs or worrying about blogs, which are essentially online journals.

A couple of weeks ago, BusinessWeek ran a cover story titled, "Blogs will change your business," in which the magazine likened blogs to the invention of the printing press.

Heather Green at Blogspotting.net points out that blogging could not be a housing or stock market type of bubble:

Thankfully, it doesn't look like that is happening in the absolute sense of the definition: meaning we aren't seeing a repeat of the kind of crazy venture capital investment and public investing through IPOs in unproven startups that we saw in the late 1990s -- and that precipitated the stock market downturn in 2000.

There hasn't been a big financial investment in blogs. We have seen the big Internet technology companies like Google, Yahoo, Ask Jeeves and MSN invest in blogs. However, the public is not caught up in blogging financially and throwing money at blogs like you see with a stock market or housing bubble where people pour their life savings into an investment. There has been an individual time investment in blogging which could peak -- but it seems unlikely that individuals will move away from a medium that is giving them a voice for free. Instead people will use blogging to to expand the "free voice" they have been given into music and video like we are already seeing with podcasting and video blogs.

There have been a few isolated loud arguments against blogs over the past few months. Dr. Bombay had a strange one. The Media Post recently had a pessimistic view of blogging in an article called The Bursting Blog Bubble which begins:

That Cosmic Crash You Heard last Monday was the sound of a million egos collapsing when a new Pew/BuzzMetrics study failed to find inordinate agenda influence by bloggers in the 2004 presidential campaign.

In fact, eMarketer Inc. said recently that there is evidence that most U.S. Internet users don't know what a blog is. And that only 4 percent of major U.S. corporations have blogs available to the public for purposes such as corporate marketing, communications, or advertising.

Many see these numbers in a different way -- as an opportunity to get more of the public interested in blogs and a growth and PR opportunity in corporate blogging.

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