Online Media Cultist

It hit home for me this morning – not enormously revelatory of course to anyone paying attention – that we’re in the midst of a great and sweeping period of mergers and acquisitions right now in the tech and Internet space. We’re probably in something like the “latter web 2.0 days” of the Internet’s evolution, a time where big players are swallowing littler ones in an effort to grab market share, where the companies who produced the best ideas and services and were lucky enough to grab eyeballs and users and customers along the way are now setting themselves up for the long haul, and the sad shakeout of those companies who didn’t make it will continue to play out as spaces continue to become better defined.

Just taking a look at the news this morning, we see that Microsoft announced the acquisition of Rapt, a company involved with online advertising technology. Technology companies are now advertising companies, and Google, Microsoft, Yahoo, and so on have been gobbling up companies and technology left-and-right for the last year or two now in an effort to gain an edge.

We also see Microsoft still trying to strategize its way toward a merger with Yahoo. The argument goes that Microsoft + Yahoo > Google. We’ll see how that goes.

Moving on, we see AOL making great strides to propel itself back into the elite tech companies pantheon. Just this week the acquisition of Bebo was announced, and now rumors say that the acquisition of “out of the box” social networking platform Kickapps could be next.

As the economy overall remains jittery, I think we’ll see this overall trend continue. Soon enough though new-fangled semantic web services will appear, social networking will evolve to its next phase, online video advertising models and companies will mature, website traffic metrics will improve, and overall Internet usage will shift.

And then we’ll be in a new place, and it’ll be fascinating to see how it all plays out then as well.

Microsoft chief Steve Ballmer announced that his company is planning to buy 20 web companies a year over the next five years.

Even if this assertion is hyperbolic, it shows that industry giants such as Microsoft, Yahoo, and Google are fueling up, beefing up, and counter-moving one another by gobbling smaller, nimbler, and more innovative tech companies.

In a way, the relative path to riches and fortune for your average young tech genius in the proverbial garage is easier than it was 10 years ago, and perhaps ever before. Instead of the daunting task of assembling VC millions and climbing the mountain to a successful IPO, it’s now possible to slave away in your parent’s basement or dorm room for a year years on limited or zero funding with the hope of getting gobbled up for a few quick millions by one of the titans.

Further, for the right kind of tech entrepreneur, that’s a much more interesting prospect than bothering to go to college or start out as a cubicle slave at a starting wage at a much larger company. And in fact starting your own company and then getting bought out by a larger one can often be a way to accelerate way up the food chain.

In short, this is a good thing for everyone. The big question and hope is that the big companies do something interesting with both the technology and employees that they gobble up.

Lots of pushing chess pieces round the board by the Interwebs Overlords this morning.

First and foremost: Microsoft is in talks to acquire Yahoo for $50 billion, Mashable and a bunch of other people are reporting.

I get the feeling that the other major players on the board realize that they have to come together to take on the overwhelming power that is Google. It also does on the surface seem to make a lot of sense because of Yahoo’s core competencies in search and online media and Microsoft’s software and operating system strengths. There’s also a lot of chatter about how this move is happening now due to Google’s recent strategic maneuver in gobbling up Internet advertising firm DoubleClick.

Meanwhile, in a separate development that could be as far reaching in terms of influence and effect as the potential Microsoft-Yahoo deal, YouTube is going to go into the business of revenue sharing with some of its most popular video creators, such as the (in)famous Lonelygirl15.

While Om Malik asks, “what took them so long?” I’m rather surprised at this move. Adding pre-roll or post-roll or something-roll ads in videos makes perfect sense – something YouTube is now experimenting with – but the ad revenue-sharing with people uploading “user generated content” has not yet proven to be a viable business model. Perhaps YouTube is hoping to experiment with its biggest grassroots stars with the thought that they can pull the plug if it does not prove viable.