Marketing

The Value of Social Networks in 2009

[](http://www.techcrunch.com/2009/06/04/the-true-value-of-social-networks-the-2009-updated-model/)
(source: TechCrunch.com)
[TechCrunch](http://www.techcrunch.com "TechCrunch") has just released their [2009 estimated value of the most important social networks](http://www.techcrunch.com/2009/06/04/the-true-value-of-social-networks-the-2009-updated-model/ "TechCrunch - Modeling The True Value Of Social Networks: 2009 Edition") around the globe, based on the model they used in [2008](http://www.techcrunch.com/2008/06/23/modeling-the-real-market-value-of-social-networks/ "TechChrunch - Modelling the Real Market Value of Social Networks") for the same purpose and based on the idea that “users in high-value online advertising markets like Japan, the UK and the U.S. were worth more (financially speaking) than those in lower value online advertising markets.” (source: [TechCrunch.com](http://www.techcrunch.com/2009/06/04/the-true-value-of-social-networks-the-2009-updated-model/ "TechCrunch.com"))

Based on the current number of users, the current market valuations of various social networks as depicted by either financial transactions, financing or other means, as well as other factors, such as average advertising spending for each online user, TechCrunch has come up with a graph depicting the distribution of the shares of the social network market.

Based on their model, the top five social networks worldwide are Facebook, MySpace, Bebo, Twitter and LinkedIn, with estimated valuations of 10 bil USD for Facebook, 6.5 bil USD for MySpace, 1.8 bil USD for Bebo, almost 1.7 bil for Twitter and 768 mil USD for LinkedIn. One of the conclusions that can be drawn from this model is the following: “If Facebook is worth $10 billion (37% of the value points), the value of the entire social networking industry is $27.1 billion.” (source: TechCrunch.com)

Another conclusion that can be drawn from this is also that being number one does not mean a secured leadership and control position, because in this day and age, almost any challenger can jump up and become the new leader in an online industry segment (i.e. MySpace was no#1 last year, but this year Facebook stormed into the no#1 position, with Twitter and LinkedIn following strongly).

While still not fully tapped market, social networks have proven their financial value, but not really (or not yet) their underlying business models. It’s clear though that the future lies in communication and collaboration and social networks do play well in these categories. However, I think there is still no killer social networking application yet, at least nothing comparable to what the iPod & iTunes were for the online music industry.

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About Daniel

Digital marketer with a solid background in technology.
  • Bucharest, Romania