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Blogs Booming?

By Alyce Lomax (TMF Lomax)
January 3, 2005

Everyone's been saying that blogs are hot. Well, despite the fact that a supposed 62% of us don't actually know what a blog is, we can still argue that blogs are, at the very least, getting warmer. According to the latest data from Pew Internet and Family Life Project, blog readership jumped a hearty 58% in November from February, with 27% of total Internet users saying they read blogs.

If you are among those who don't know what a "blog" is, it's short for "Web log." For a long while, the term encompassed often geeky, Web-based diaries. However, as blogs have started slowly creeping into our consciousness (and browser bookmarks), some have also gained clout as a serious source of information, concepts, or ideas. Another democratic function of blogs is the mechanism for reader comments, making discussions even more interesting.

The data from the Pew study is quite timely, considering our own longtime Fool contributor Selena Maranjian theorized just last week on the future of newspapers, such as those run by Gannett (NYSE: GCI), New York Times (NYSE: NYT), Tribune (NYSE: TRB), Dow Jones (NYSE: DJ), and Washington Post (NYSE: WPO). She discussed the idea that blogs present a new and evolving obstacle to traditional media.

As Selena pointed out in her Take, while there are plenty of silly blogs out there, there are also some that contain intellectual discourse or information (and sometimes even breaking news). What's known as "the blogosphere" got its first major dose of the limelight with the recent presidential race, but now bloggers' coverage of the devastating tsunamis in Asia is making headlines, too.

Although investors who have taken stock in newspapers and other media companies ought to keep a careful eye on the trend, for the time being, blogging itself is still an area where nobody's making much money. After all, most bloggers -- excluding the most prolific, widely read ones -- don't make any money on their hobby. And readers aren't charged for blog content.

However, Google (Nasdaq: GOOG) was one of the first public companies that acknowledged blogs, given its acquisition of Pyra Labs, maker of Blogger, a service that made blogging easy. (Blogger, of course, serves up Google-style text ads on some of the blogs it hosts -- Google's not stupid.) Meanwhile, we also know that Microsoft (Nasdaq: MSFT) recently began its own foray into the arena (my Foolish colleague Seth Jayson just gave me a quick tour of MSN's "Spaces" product, which I have to admit looks pretty darn stylish and seems to contain some features that Blogger lacks).

The Pew data does show that the majority of Americans still don't know what a blog is, posing the idea that, despite no shortage of hype, the blog phenomenon could remain a niche or stagnate at these levels. However, it seems to me that's a slim chance. How this industry evolves will be of the utmost importance to traditional media -- and Internet-based -- companies, and the individuals who have invested in them.

Are you a blogger? Or do you like to read blogs? Check out our discussion board, Blogs, Blogging and Bloggers, to discuss the craft with other Fools.    

Alyce Lomax does not own shares of any of the companies mentioned, although she does have some blog buddies she has never met in person.