May 1st, 2006
Follow the money
Nick Carr asks who is making the big money in the Web 2.0 era of user-generated (or user-submitted if you are Google) content. Certainly not the users, and the Web sites monetizing the content aren’t overflowing with riches. Try infrastructure companies like Limelight Networks, which provides content delivery network services for YouTube, FaceBook and XBox Live. Nick writes:
The way the Web 1.0 dot-com pioneers used pricey computer gear, the Web 2.0 digital-media pioneers use bandwidth. They devour huge gobs of it. YouTube, Forbes’s Dan Frommer writes, is probably burning through a million bucks a month in bandwidth costs, a number that’s going up as rapidly as its traffic. Follow the money. In this case, as Frommer reports, the trail will lead you to Limelight Networks, which YouTube uses to stream all that user-generated content - like 200 terabytes a day - back to us users. Once again, it looks like it’s the suppliers - in this case, the content delivery networks - that are positioned to be the most reliable money-makers as more and more investment pours into the creation of our vaster, user-generated wasteland.
Dan Farber, editor-in-chief of CNET News.com, has more than 20 years of experience as an editor and journalist covering technology. See his full profile and disclosure of his industry affiliations.
