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Sky-high social-media valuations are driven by usage.
Just look at the numbers: Twitter serves more than 90 million tweets a day. Zynga serves 45 million gamers daily. And that's mostly through Facebook, which says its users spend more than 700 billion minutes on its site monthly.
Goldman Sachs (NYSE: GS ) got in on the Facebook frenzy when it invested $450 million at a $50 billion valuation in January. Zynga is raising money at a $10 billion valuation. Twitter last month was pricing itself at $8 billion to $10 billion in buyout talks. This is the benefit of being among the social Web's top daily destinations.
LinkedIn wouldn't know. The social site that's come as close as anything ever has to replacing the traditional resume isn't a daily stop for the digitally addicted. CEO Jeff Weiner aims to change that.
He'll do it by taking on Google (Nasdaq: GOOG ) , Yahoo! (Nasdaq: YHOO ) , and AOL (NYSE: AOL ) with a social news service called LinkedIn Today. "We want to give you what you need to know to be better at what you do," Weiner told The New York Times in an interview.
It's an interesting strategy. Each user's edition is built algorithmically, like a personalized edition of Google News. As I write this, my LinkedIn Today leads with the news that social-advertising specialist RadiumOne has raised $21 million at a $200 million valuation. The tragic earthquake off the coast of Japan is also a top-shared item.
Sharing is what informs LinkedIn Today. The site shows me what my friends like -- i.e., what they're sharing -- on the belief that my relationships make these stories more relevant. From there, I can customize the topics and news sources I follow. I can also see who's shared a story that appears in my feed.
On balance, I like the idea. But I also wonder if this is too little, too late. I'm already suffering from information overload thanks to Google News and an avalanche of RSS feeds managed through Google Reader. My Twitter lists also feed me good info. From what I can tell, LinkedIn Today isn't materially better than these alternatives.
But maybe that's not the point. As it now stands, LinkedIn is valued at about $3 billion on the same private equity exchanges where Facebook has traded for as much as $82.9 billion in implied value. Boosting traffic from the site's 90 million members even modestly could result in a bigger haul in an IPO scheduled for later this year.
In this sense, LinkedIn Today isn't so much a news service as it is a shout in a crowded room. ("HEY! We're still here, people!") LinkedIn matters. Weiner just thought you should know.
Do you agree? Disagree? Let us know what you think about LinkedIn Today, social-media valuations, and your own struggles with information overload using the comments box below.
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