Social Nets And Big Media: A Dependent Relationship, Says VC Klein

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Reuters has gone big on Index Ventures partner Saul Klein this week. The former Skype VP who, as a VC, has invested in the likes of, OpenX and Moo, appeared at the newswire’s Paris summit with words of wisdom on the value of social networks to traditional media. Bottom line: it’s a relationship based on dependence…

“There are social media networks that have come from nowhere in the last three to four years that have built enormous audiences. But without a sales force you’re just not going to generate significant revenues and explain to advertisers what the opportunities are. The point when Bebo got acquired was just when they were starting to show monetisation and AOL (NYSE: TWX) has a sales force that has been selling online ads for 15 years. What they were missing was the audience.” He said the same thing of and CBS (NYSE: CBS), which is working the social music site hard in the US on the advertising front. And big ad sales’ experience may be doubly important after forecasts for social network ad spending were cut this week.

Reuters’ video profile of Klein after the jump, and here’s my interview with Saul from October.

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carl lachmann

In these days with the stats tussle over who has the most visitors among the UK press it would be of interest to run a parallell check on how far they have gone in implementing social network functionalities on their sites. Another parameter that would be good to compare would also be the page impressions, that do have an impact on the ads you can sell (=read money).

SO – how are the media houses going to get better at this? It is a huge task – in the traditional CMS they are handling vertical information, ie one journalist writing to many readers, alsmost static information, to be published. In social networking it is all about handling horisontal information – users writing to publish to other users, immmediately. Can you build this up using open source tools? Sure – but you may find that it will not scale, be flexible enough, or not work well together. Is there any tool / platform out there that can do it all, including rich media like video? Our platform, XCAP, can do it all – do not take my word for it – check us out!

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