There are a number of web based services that I use on a daily basis that I find to be very useful. I use FriendFeed to keep track of the postings from people who I find interesting.  I've been using Seesmic Desktop recently to keep track of activity on Facebook and Twitter.  I also use Google Reader to keep track of news and blog posts via their RSS feeds.

All of these services have a certain level of importance to me but I know that eventually some of them will be gone. The short answer as to why they will be gone is "money." None of these services has any appreciable revenue streams relative to the costs to run them. As far as I know only Facebook (via advertising) and Twitter (via a small amount of advertising) have any sources of revenue. Seesmic Desktop, FriendFeed and Google Reader seem to exist on the power of previous investments alone.

The ability to earn revenue from customers is only one factor in the survival equation. Access to capital is another factor. As a part of Google, Google Reader has no capital worries. You could even argue that Google Reader does have a revenue stream because it allows the presentation of Adsense in RSS feeds which Google earns revenue from. Facebook also has access to substantial capital due to the sheer size and growth potential of their service.  Even so I think that there's about a 10% chance that Facebook fails at some time during the next five years. Even as the growth of Facebook makes the service more valuable the cost of running the service grows as well.

Twitter, FriendFeed and Seesmic are in a much less enviable position. Much has been made of Twitter's growth in recent months. It's true that Twitter's traffic numbers have exploded but who really knows what traffic and registered users are worth these days? Traffic and users are certainly not worth what they were two years ago when cash was flowing freely into the Web 2.0 space. Given the buzz around Twitter I think that they could be able to raise more capital if they needed to. Then again, each time Twitter (and Facebook for that matter) raises capital they dilute earlier investors and shareholders. That can't sit well with employees who are banking on a big payday at the end of the rainbow. Heavy users of the service are the ones who need to be concerned though. A lot of social marketing campaigns and 3rd party application developers are counting on the success of Twitter. Twitters lack of revenue after two plus years in the marketplace should worry these folks. I think there's a 25% chance that Twitter fails during the next five years.

FriendFeed and Seesmic are in the most trouble. FriendFeed is a service that is useful for heavy web publishers and the people who follow them. But how many people are heavy web publishers? It's a very small slice of the web publishing market. For every Scobleizer there are thousands of casual publishers who can make do with the functionality offered by Facebook. I also think that followers on FriendFeed are more likely to be "friends" in that special web 2.0 category as opposed to real friends and family that people are connected to on Facebook. So while FriendFeed has value that value exists in a deep niche of web users. I don't think advertising will work well with the users on FriendFeed. So FriendFeed will either have to start charging for something (an iPhone app maybe?) or be sold to someone with deeper pockets in order to make the service work in the long run. As such I feel that there's at least a 50% chance that FriendFeed fails within the next two years.

Seesmic has the toughest road ahead. The core Seesmic video conversation service had a lot of early buzz but that buzz has since died down. The fact is that most people are not prolific publishers with video. And it's also a fact that video is expensive to store and stream. So at some point you either have to charge for the video service or you need to integrate large amounts of advertising. Seesmic has done neither. Seesmic is also the only startup service in this list that has done layoffs. The Seesmic Desktop application has increased interest in the company. How does Seesmic capitalize on a free desktop application? The only two methods are advertisements and charging for the software. It's hard to charge when competitors (such as TweetDeck) exist and would probably continue to offer their application for free. There's no loyalty in Web 2.0 land. Most people would defect to a new tool rather than pay. Advertising might bring in some revenue but would probably cause people to switch services if the other comparable service is not inserting ads into the stream. It's a tough situation. So unless Seesmic gets bought out I think there's a 75% chance that they fail within the next two years.

The possibility of the failure of a web service where I publish or store information is something that I consider when determining how much time to invest on that service. Of all the services on this list the one that poses the most risk to myself is Facebook. FriendFeed is mostly an aggregator of things I publish elsewhere. Twitter is a place where I publish links and short messages but I don't consider the content I post there to be particularly important. Seesmic desktop is a tool that helps me watch activity and can be easily replaced. I use Google Reader to share and comment on news and blog posts but I also think that there's no chance that Reader is going away anytime soon.

I take steps to mitigate my personal risk by not putting too much effort into any one service. I have the most exposure to a Facebook failure but I also limit the amount of things that I publish there. I don't rely on any single service to promote the myself, build my network or socialize. I've got my own domains running my own versions of web applications that act as the cornerstone of my presence on the internet. I see many people (and even businesses now) that increasingly rely on some of the services mentioned in this post (and others with similar risks) to build and maintain their presence on the internet. To them I say beware. Some of these services are doomed and if you rely on them too much you stand to lose a lot when they fail.

We are living in a world of dilution. Lots of people are creating lots of content. There are many companies that want to get a hold of that content so they can use it for their own purposes. And those companies won't pay the original publishers a dime. That's not a good thing.

One of my favorite books teaches some great lessons that surely apply to publishing content online. The 7 Habits of Highly Effective People instructs us to begin with the end in mind. If we follow Stephen Covey's logic then it is a very good idea to think about how and where we are publishing our content.

Your content is your currency. The content you publish will create your value in the long run. If you give up too much control of your content, spread out your primary publishing locations, then a dilution of your value is taking place. Think about this when you start publishing on the web.

This idea won't really matter to people who are casual users of the web. And by casual I mean people who aren't publishing content on a regular basis or aren't publishing for business purposes. If you have a presence on a social network or two in order to connect with your friends or you upload occasional photos and videos to sites like YouTube or Flickr you are probably receiving good value in exchange for your efforts. If you publish on a regular basis this idea should mean something to you.

Sites like MySpace and Facebook have managed to command huge valuations due to the efforts of their users. The same goes for iTunes, YouTube and Flickr among others. The valuations for these properties are based on the presence and the published content of the site's users. It can be argued that the sites I've mentioned here have provided value to each user in excess of the effort put forth by the user to add their content to the site. These sites have achieved critical mass and thus provide access to very large audiences. These top tier publishing sites also provide tools that simplify online publishing which have helped to create access to the masses. For the serious publisher there is definitely value in having access to a mass audience.

There are many other services that want access to your content. They want you to publish there. They want you to bring your audience to them. Some of these services include Twitter, Disqus and Seesmic about whom there has been much talk in recent months. If you invest your time in these services what will you get out of it? What will they get out of the deal as a result of your efforts there? Are the tools they offer unique? Do they provide access to a mass (and I mean in the millions) audience? These are important issues to consider.

Lately I've begun to recognize the importance of not only owning my content and discussions but also the ability to control my content and discussions. The important part of the control factor is the ability to shape my brand around the content I publish as well as having access to monetization options of my choosing. So nowadays when I consider how much (or even if) I should use a service I think about those things. Many of the newer services that the members of the herd are enamored with don't meet my requirements. So I'm becoming less active on those sites and more active on my own domains.

Begin with the end in mind. Think about how and where you publish your content affects your value and your brand. Weigh the long-term costs and benefits of using third-party services. And as you weigh these issues ask yourself a question. Do you want to be in the business of building value for someone else or for yourself?

Good post yesterday by Seth Godin titled, Thanks. Seth makes a very salient point in his post when he writes, "Every time you read something I write here, you're giving me a gift... attention."

Seth writes this in the context of whether or not he should have ads or sponsorships on his blog. Should you have sponsorships or random link ads on your site? Do you want your site visitors to go away?

Every time I go to a new Web2.0 service and see those Adsense or Adbrite ads I think, "They're happy to see me go away." The same with blogs that have these types of ads. The writers of those blogs want me to click on those links and go away. Why would you put them there otherwise?

For some sites having random links show up makes sense. There must be some people who make really good money from it. Those same people must also have great content that has people coming back regardless of the distractions. Ditto for paid sponsorships, which I think are generally more relevant than those wild random links that sometimes even show links to competing services.

Its not only independent bloggers and Web2.o startups that are in love with sending people away. Sony Records frequently develops sites for their artists (like Ozzy Osbourne and Kelly Clarkson) that include Adsense links and banner ads. I guess they would rather that visitors to artist sites spend their time and money elsewhere.

I think that anyone who is trying to grow their audience or grow users to their service should use their precious website space to keep people on the site, not send them elsewhere.