I remember the day when I used to check in to CNET on a daily basis sometimes even multiple times a day. I read an interesting article on 24/7 WallSt that signaled a real decline in revenues with CNET. And the large culprits appear to be independent tech blogs. It’s a sign that the little guys and some big guys can defeat a behemoth in any industry.
In the last quarter, revenue at CNET (CNET) hit $97.2 million. That was only 5% better than the same quarter a year ago. Given that CNET is perhaps the premier provider of tech information on the web and had over 31 million unique visitors in the US during June, the lack of growth seems amazing.
The company has a market cap of $1.1 billion, so it trades well below 3x sales. TheStreet.com (TSCM), which has a similar business model, trades at nearly 6x.
CNET has options back-dating issues, but that does not appear to be an problem that will severely hurt the company’s business operations.
A fair amount of evidence points to blogs as the cuplrit for CNET’s troubles. A quick look at the largest blogs shows that most of them cover technology related subjects: Engadget, Boing Boing, Gizmodo, TechCrunch, O’Reilly’s Radar, and GigaOm. And, that is only a partial list.
2 responses so far ↓
hso || Aug 8, 2007 at 3:57 pm
The little guys really probably only make a very small dent, it’s the big guys that employ 4 to 6 guys to get their scoop that are stealing the show. If I remember right, even BBC had referenced TechCrunch!
David Krug || Aug 9, 2007 at 8:53 am
I agree us little guys make a tiny dent. But it all adds up to lost revenues.
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