Muhammad Saleem is a social media consultant and a top-ranked community member on multiple social news sites. You can follow him on Twitter

By now you have probably read the countless articles about how flawed the contextual advertising system is on Digg. The system at Digg is certainly flawed, but not just in terms of contextual advertising. And one site - StumbleUpon - it seems, plans to capitalize on those flaws (and very well might be successful in doing so).

If you’re a successful online publisher, service provider or Internet marketer then you’re probably well aware of the advantages of using (not exploiting) social news sites. If your site or service falls in a niche that matches nicely with the vertical (and demographics) of a particular popular social news site then you stand to gain hundreds of thousands of visitors by creating content for the audience of that particular site. The problem, of course, is as people realize the importance (or viability) of social news sites as marketing platforms, many of these people try to exploit them with poor content and then pushing it via brute force promotion, buying votes, using multiple accounts, and other terms of service and use violations.

To prevent such people from ‘gaming’ the system by inflating votes, the social news sites increase the sophistication of their promotion algorithms by making the ‘gaming detection’ more robust and demanding a higher degree of diversity in votes on a story before it can be promoted and get the traffic (which at that point the algorithm deems deserved).

It seems, however, that this increased sophistication doesn’t always work as planned and often penalizes certain users and sites more than it should, and in many cases overzealous moderators (on social news sites) end up banning users and sites for spamming activity or other terms of use violations. Because of this, these social news sites incur the ire of many users in the social news community, independent publishers, as well as marketers, and often rightfully so.

A different approach

Ultimately, these sites have established terms of use and service and they are well within their rights to make the decisions, however detrimental they may be to the community and the long-term profitability of the sites. On one end we have Digg, that has long raged a war against marketers and often the very people that helped build the community and is quite often criticized for it very vocally. At the same time, the site that was once a beacon of hope for the independent publishers, now seems resolutely aligned with the mainstream.

But on the other end, we have StumbleUpon which has decided on a markedly different approach to solving its problems. StumbleUpon bans users that are seen to artificially inflate votes on content because of the terms of use violation, but then offers a viable alternative to those who want to legitimately use the service to cash in.

A look at revenue

StumbleUpon’s 2008 expected revenues are approximated at $5-7.5 million. At the same time, Businessweek estimates that in the first three quarters of 2008, Digg lost $4 million on $6.4 million in revenue. While I don’t know the costs to run StumbleUpon, it’s fair to assume that they are far less than running Digg, not only because StumbleUpon is substantially smaller in terms of users and monthly traffic, but also because the service doesn’t require the same number of servers or have to deal with the bandwidth costs that destination sites like Digg do.

So how does StumbleUpon manage to make comparable revenues to Digg with far less traffic (as a destination) and a substantially lower number of users, while not alienating marketers and publishers? It’s quite simple actually, and considering that it’s no secret and nothing new, it’s surprising that no other social news site has been able to do something similar. StumbleUpon uses a two tiered approach to making money while keeping the community, the marketers, and the publishers happy.

1. Sponsored Users - while a free, basic StumbleUpon account has everything that most users will ever need, the service allows you to upgrade to a sponsored account for a modest fee.

2. Sponsored Stumbles - to resolve issues with marketers and publishers, StumbleUpon allows them to buy traffic from the service. Before you start thinking that paid traffic pollutes the integrity of a trust-based social news site, consider their justification: the whole purpose of the site is to determine the preferences of a user based on his or her habits (thumbs up or down) on the site and then continue to send the user targeted sites. If the service performs its functions well, then it shouldn’t matter if the content is sponsored or not, because in either case the content is relevant to your interests based on StumbleUpon’s recommendation engine.

Rather than outright banning users for violating the terms of service, StumbleUpon sends them the following email while putting their accounts under review.

Our Terms of Service prohibits members from creating multiple accounts without permission or using a StumbleUpon membership to promote a specific site, business or product. If you’d like to advertise on StumbleUpon, please visit this page for more information: http://www.stumbleupon.com/ads

Why hasn’t Digg been able to monetize?

Going back to the original point for a moment, the reason why Digg hasn’t been able to monetize the site is partially because over half the users don’t actually view the ads (on Digg or the sites they click out to) and the ones that are able to see ads aren’t clicking on them because the ads just aren’t relevant to them, but just as important, it’s because they haven’t been able to leverage the audience with the publishers the way StumbleUpon has managed to.
In fact, Digg doesn’t even seem to have a plan in place to do so. According to statement from Jay Adelson from last month, here’s the monetization plan for Digg:

The company recently started to sell ads on its RSS feeds. It is on the verge of launching a revamped version of its homegrown search engine that the company hopes will produce more relevant and profitable search advertisements. And it is within a month of closing a deal with a mobile ad provider to sell more ads on cell phones.

The answer is pretty straightforward, Facebook figured it out with Beacon (though they butchered the implementation) and StumbleUpon figured it out a long time ago. Leverage the demographic goldmine you have to understand your target audience, then use your collaborative filtering and recommendation engines to nail down the exact preferences of your patrons, and finally give them what they want, but charge the people whose content you’re delivering. Targeted traffic (and audience/community building) doesn’t get better than that.

Also noteworthy, StumbleUpon, which has recently unveiled a new design, has upped its efforts to increase revenue, and in a surprising but very intelligent move, has started to market its paid traffic service to the Digg audience.

Keep in mind, eBay has done virtually nothing with StumbleUpon so far but has plenty of options to explore. Perhaps Om is right, maybe Digg should buy StumbleUpon (or the other way around considering the underdog is profitable).

Interested in Digg and StumbleUpon Resources?

- HOW TO: Get the Most Out of StumbleUpon

- Diggs Recent Bans and the Limits of Crowdsourcing

- Digg Toolbox: 50+ Digg Tools and Resources

Image courtesy of iStockphoto, SteveChristensen

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In addition to being a microblogging and communications tool, Twitter can also be an RSS reader if you subscribe to the right feeds. For example, the Mashable feed automatically updates each time we post a new story, meaning if you follow us, you’ll see a link to each entry in the timeline on your Twitter homepage.

Digg is getting in on the act, launching separate Twitter accounts that you can follow for each of their different news sections. Each time a story reaches the Digg front page, it will be broadcast to one main account - Digg Homepage – as well as to the account representing the category the item was in, like Technology, Science, or Offbeat.

Of course, this could already be accomplished if you use an RSS reader by subscribing to the feeds Digg offers for each section, but for the millions of people that don’t do so, following Twitter accounts is a nice and easy alternative. It also means that perhaps you can unfollow Twitter accounts for individual blogs and let Digg act as your filter, but we highly discourage such behavior

A full list of all of the accounts you can follow is available on the Digg blog.

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Facebook has added a small but useful feature that makes Posted Items a bit more interesting. Now, when you click on a friend’s Posted Item, you’ll get a Facebook navigation bar “layered on top of the page you arrive on,” (in a new tab) as you can see in the example below.

The value here is that opposed to navigating back and forth between the new tab and Facebook, you can view comments, add new ones, and share the item yourself, all from one convenient navbar that hovers over the posted item. This should increase engagement around posted items, as well as give them a bit of a viral boost as users “re-share” items that their friends have posted.

Posted Items already became a bit more prominent on Facebook when they got their own tab on the homepage with the social network’s major redesign earlier this year. Some pure speculation: now that Facebook is further encouraging users to engage with Posted Items, could an aggregate view of the site’s most shared items (ala Digg) be in the works? It could be tricky given the privacy settings around user comments, but would certainly be feasible as the company expands its media strategy.

Like most Facebook rollouts, the navbar is being released to everyone over time, so you might not see it in your account just yet.

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Dan Schawbel is the author of Me 2.0: Build a Powerful Brand to Achieve Career Success and publisher of Personal Branding Magazine and the Personal Branding Blog.

There are literally thousands of social networks on the web right now, but which ones should you join?

Many people have spread out their personal brands on too many networks and are now unable to manage their existence on all of them. As the number of social networks grows (more startups) and shrinks (economic downsizing), we must be smarter about which ones we join and which ones we ignore. Today, we’ll go over a simple method you can use to figure out which social networks to participate in so your brand is visible and easily manageable across the web.

A social network is only as strong as the amount of people that are a part of it

Think about it, if a message board has no messages or a blog has no comments, the likelihood that you will be the first to contribute is slim. If there is no one to interact with on a social network, then why join? If people in your location aren’t using it, then it makes no sense to join as well.

Facebook has over 110 million users, MySpace has close to 200 million users, LinkedIn has over 30 million users, and Twitter has over 5 million users. It’s safe to bet that joining a social network with millions of users is the way to go because there will be many people you already know on them. Also, a large volume gives you the ability to share your brand with many people, instead of just a few.

Credibility matters

So the social network has a million users; that’s great. What if the million users are people with no status and are not more successful than you are? There is no point in being part of something that can’t serve as both a support system and resource for your personal brand. If the people on the network aren’t credible, then you won’t get anything out of it.

To me, LinkedIn is the most credible social network on the planet right now because it contains profiles of Fortune 500 executives and leading entrepreneurs. The average individual salary on LinkedIn is $109,000 and legends like Bill Gates have already setup their profiles there. Then there’s Twitter, which is home to celebrity users such as Britney Spears, Shaquille O’Neal and MC Hammer. Facebook has industry titans such as Michael Dell and MySpace is home to Paris Hilton.

Ponder relevance

The largest social networks, with millions of users, are always going to be relevant for you because they target the masses and not a single niche. Any smaller network that you join must be supported by an interest that is relevant to your brand. Aside from the main topic of the social network being of importance to you, the users on that network (credibility) are just as important.

Totspot.com is a social network for mothers and their babies. If you are a single male who attends college, this network certainly isn’t for you. The same goes with MyDogSpace.com, which is targeted at people who have a pet dog. If you don’t have or want a dog, then you best join a different network. Signing up for every social network is a waste of your time and gives you no means to start or hold a conversation with that audience.

What about PageRank?

PageRank is extremely important for your personal brand because it allows you to command your Google results. This is great for promotion and protection in the digital world. If you sign-up for social networks that have a high PageRank (see volume), you can block any bad press you may receive over your lifetime.

For instance, if you Google my name, you’ll see my LinkedIn and Twitter accounts in the top 10 results. These are two spaces where there isn’t bad press or content that I don’t want people to view. My friend, Jeremiah Owyang, states that your Google results are your new business card. Your results are a depiction of who you are, so it’s smart to join the networks that best represent your brand, and carry a high PageRank, so people can easily view them and be impressed. Any social network with a PageRank of 6 or higher is satisfactory.

Some social networks aren’t built to last, especially in this economy

If you don’t believe a social network will withstand this economy because it’s not funded or because it doesn’t have a business model, then don’t bother. If you join a social network, take the liberty of filling out a profile page and then spend hours building a community, then find out it’s shutting down, you’ve lost all of your hard work. You wouldn’t have enough time to direct others to your other networks before the sites closes.

Create a social network worksheet

To further show you how to classify social networks and select the best ones to house your brand on, I used Microsoft Excel to create a spreadsheet. Notice how the “usual suspects” pass all the tests, while some of the niche players do not. This spreadsheet is “personal specific,” meaning that it’s built through my eyes and not yours. Some of these networks are relevant to you, so you should join them to meet people who are similar to you. Does a network have to pass all these tests? I would say as long as it passes at least 3 of them, you may want to join it.

If you want to get more value out of this kind of worksheet, then add a column for “user name” and one for “password,” so you can keep track of where you are and how to access each one.

First impressions on the web

As the number of social networks increases, people are tempted to join more and more of them. When this occurs, your personal brand becomes spread too thin. Your ability to constantly update each profile, to ensure it includes the most updated and accurate information, will be unmanageable and unenjoyable.

Also, by joining a social network, you are setting “conversational” expectations, meaning that people should expect you to have a decent level of participation on each one. If you fail to update your profiles and, either build content or network with other users, then it’s a waste for you. The only exception is if the social network has a high PageRank, which you can use as a defense mechanism.

What all of this comes down to is how first impressions on the web have been completely redefined. Each entry point into your personal brand may be different (how people access information about you), so consistency and accuracy becomes extremely important. In this way, limiting your social network participation to only the one’s you’re most suited to communicate on, is highly encouraged.

Next step: how to manage your social networks

After selecting and committing to using social networks in your daily routine, it’s time to learn how to properly manage them. When it comes to your profile information, you will have to manually update it over time. A LinkedIn profile, for example, won’t fill itself out on its own. A systematic approach you can use for updating your profiles, could be writing down the ones you’re on and the date when you last updated it. Every time there is a milestone in your life, you should make sure they all reflect that update.

Here are a few tools you can use to update your content on social networking sites. By using these tools, your personal brand will have a consistent message throughout the web.

- Tubemogul: If you like web video and want to see your videos appear on many social networking sites at the touch of your mouse, then Tubemogul will be a very helpful tool. After submitting a video using this service, your video will load on MySpace, YouTube, AOL Video, Blip.tv, and more.

- Twitter Feed: Ever wonder why many blogs are broadcasted on Twitter automatically? By using Twitter Feed, you are able to syndicate your blog entries through Twitter, without having to manually tweet each post.

- Gravatar/OpenID: Your picture and name are the two most important brand assets you have on the web. Instead of uploading different pictures of yourself to various websites, Gravatar/OpenID will take your web presence and make it consistent wherever you go.

- Ping.fm: How would you like to update your status once and have all your social networking sites respond? Ping.fm allows you to submit a status update and have it appear on around 30 social networking sites, such as Twitter, LinkedIn, Flickr and Del.icio.us, within seconds!

- FriendFeed: This service has gotten extremely popular, especially when Twitter had a lot of downtime months ago. All you need to do is submit your social networking accounts and it will stream them into one feed that people can subscribe to or that you can push out to Facebook and other networks. Another tactic you may try is to use create your own FriendFeed widget, which you can embed on social networks, your blog or website. People will get a better sense of everything you’re doing using FriendFeed and it will save you time from re-creating the same content.

Managing your social network profiles will become increasingly tedious, unless you take the proper steps to only join ones that will further your personal brand and use social tools to alleviate the process. Updating your profiles is extremely important, especially at a time of economic recession, when hiring managers are looking for the best talent. You wouldn’t want to look less experienced than you actually are, would you?

Imagery courtesy of iStockphoto, Qwasyx, JoanVicent

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It’s a sad day. We saw Yahoo! go through its second mass layoff in under a year. And now it’s being reported that National Public Radio — of which shows including All Things Considered, Wait, Wait, Don’t Tell Me and Car Talk have attracted a wide audience via iTunes — has eliminated 7 percent of its workforce, or 64 positions, and canceled two shows, News & Notes and Day to Day, in what is the organization’s first major layoff in more than 25 years, The Washington Post reports.

In this economy, it doesn’t come as a surprise that NPR saw a need to make some cuts -– amounting to $23 million -– despite reaching what it said is a near-record audience of 26.4 million listeners a week. NPR execs cite a drop in corporate sponsorships, which the company relies on for about a third of its profit, to a projected $33 million for the year instead of the $47 million budgeted.

The two West-coast-based cancelled shows, both of which sought to diversify NPR’s audience, will go off the air on March 20, and 22 journalists working for them will lose their jobs, including hosts Madeleine Brand and Farai Chideya.

NPR is a popular fixture in the tech community. Aside from its popularity on iTunes, its election Twitter account attracted over 14,000 followers and its political and fact-checking stories are frequently bookmarked on Digg.

[photo: flickr/aloshbennett]

I’ve pontificated many times on exactly how democratic and open certain social media tools like Twitter, FriendFeed and specifically Digg are. The idea is in most social media is that by getting a crowd together engaged in a great big free-for-all discussion, there will magically occur this effect known as “Wisdom of the Crowds.” For sociology students and readers of my editorials, we know that this couldn’t be further from the truth.

Unsurprisingly, the Barack Obama transition team doesn’t read my editorials here, and they’ve fallen into the same trap that most armchair Web 2.0 pundits do in assuming that by putting up a Digg-style forum, the Web 2.0 fairies will sprinkle their pixie dust on the site and grant them a perfectly democratic, crowd-wise forum for the open exchange of ideas.

The Politico had the story this afternoon:

President-elect Barack Obama’s Transition today launched “Open for Questions,” a Digg-style feature allowing citizens to submit questions, and to vote on one another’s questions, bringing favored inquiries to the top of the list.

It was suggested when it launched that the tool would bring uncomfortable questions to the fore, but the results so far are the opposite: Obama’s supporters appear to be using — and abusing — a tool allowing them to “flag” questions as “inappropriate” to remove all questions mentioning Illinois Governor Rod Blagojevich from the main pages of Obama’s website.

The Blagojevich questions — many of them polite and reasonable — can be found only by searching words in them, like “Blagojevich,” which produces 35 questions missing from the main page of the site.

“Given the current corruption charges involving Blagojevich, will ’serious’ campaign finance reform that takes money completely out of politics through publicly funded elections be a priority in the first term?” asked Metteyya of Santa Cruz, California.

“This submission was removed because people believe it is inappropriate,” reads the text underneath it.

The question is reasonable, offers the team a way to address something that is both topical and relevant. It isn’t as if the question being asked refers to Obama’s citizenship, something that is a highly touchy subject in most circles.

Digg Isn’t True Wisdom of Crowds, and Isn’t the Best Model for What Obama’s Team Wants

Or perhaps it is – perhaps the Obama team is arrogant enough to imagine that the will of the people will always be with them, they’ll always have a dedicated bury brigade, and thus don’t have a truly transparent government in mind for us Americans.

Taking off the goggles of cynicism for a moment, though, let’s assume that isn’t their goal.  Let’s assume they’re wanting to apply Web 2.0 principles of crowd wisdom to achieve an open and transparent government. Let’s review some pearls of Mashable wisdom to see why the Digg model isn’t a great way to accomplish that:

Pete first talked about this problem back in January of 2006 in response to an incident in which O’Reilly Network’s Steve Mallett was very publicly accused of stealing Digg intellectual property:

…Digg is not a true example of a wisdom of crowds system. Let me explain…

For the wisdom of crowds to work, every individual must work independently. For example, if I ask 1000 people to guess the number of jellybeans in a jar and then average the results, I’ll get a fairly accurate answer. However, if I allow the individuals to view the guesses of others before they vote, they may decide to give an answer which is similar to those given by other members of the group. Hence, it is more likely that the average answer will be inaccurate.

The reason that Digg creates a mob mentality is that users can see how other members have acted before they vote.

In October of 2007, I went back to the basics in my dissection of Digg and analyzed whether or not I thought it to be utilizing Wisdom of the Crowds or just simply a social voting mechanism loosely based on the concept:

The anecdote that is the genesis for the concept of wisdom of crowds I’ve heard many times over is the story of scientist and statistician Francis Galton from the late 1800’s, who was surprised that the crowd at a county fair accurately guessed the butchered weight of an ox.

What made it interesting was not that any one individual came close to guessing the actual weight, but that the crowd did. When their individual guesses were calculated to the median, the resulting number was much closer to the ox’s true butchered weight than the estimates of most individual crowd members, and perhaps most surprisingly also closer than any of the estimates made by cattle experts.

In September of this year, I took the Galton example and applied it to the failures of Web 2.0 crowd wisdom in providing any sort of a solution for intelligent discourse in the context of the campaigns:

Systems like Digg and YouTube have worked to mitigate these effects with the voting up or down of comments and the discussion points themselves, but due to the populist nature of the system, only the most controversial of topics tend to rise to the top. Elements of controversy commonly walk hand in hand with the disqualifying factors for the wisdom of crowds to truly be applied in an effective manner: emotional or divisive topics.

What are the Solutions to Counteracting the Bury Brigade?

That’s a good question for Jay Adelson and Kevin Rose. The only solution, given the limitations of the system that the Obama transition team has chosen to use for their forum is the time tested employment of human moderation. The team must, in the absence of the Digg-like sophisticated algorithms designed to counteract ideological bury brigades, go through and evaluate buried items.

This, of course, puts them in an awkward position given that they’ll be inclined to let tough questions get buried. They are, though, under intense scrutiny no matter which way they go. As the Politico piece noted, “So far, Obama’s team does not seem to have stepped in to allow uncomfortable questions to rise to the top, and instead is allowing his supporters to sanitize the site.”

Even a lay person recognizes that a human must work to counteract the mob mentality, and the absence of action on the Obama team’s part will only work to emphasize the naiveté they were accused of throughout the election.

Simply put, for all their effort, Web 2.0 hasn’t solved the problem of Mob Mentality in social systems.  Any experienced and social media-savvy person knows this.  That the Obama team doesn’t is very telling.

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Digg has sent a cease and desist to the company behind USocial.net, the website pictured above. Should we be surprised? The site is publicly advertising its service that lets you buy votes in mass quantity on Digg, Stumbleupon, and Propeller.

The social news site has come under scrutiny for some of its recent bans aimed at preventing manipulation, but you can hardly blame them for trying to stop such blatant attempts to game the system. The letter sent to USocial’s owner is pasted below:

Dear ####:

My firm represents Digg, Inc. (”Digg”). We have become aware that uSocial.net (”uSocial”) is paying users of www.Digg.com to manipulate content rankings on the Digg website. Digg hereby places you on notice that its website terms of use (located at http://digg.com/tos) expressly state:

IN ADDITION, YOU HEREBY AGREE THAT YOU SHALL NOT USE THE SERVICE (INCLUDING, WITHOUT LIMITATION, BY “DIGGING” ANY CONTENT) ON BEHALF OF (OR PER THE REQUEST OR INSTRUCTION OF) ANY THIRD PARTY. FURTHERMORE, YOU SHALL NOT REQUEST THAT ANY THIRD PARTY, OR PAY OR OTHERWISE ATTEMPT TO INFLUENCE ANY THIRD TO, MANIPULATE OR OTHERWISE AFFECT THE SITE IN ANY MANNER (INCLUDING, WITHOUT LIMITATION, BY PAYING ANY OTHER USER TO “DIGG” ANY CONTENT).

Pursuant to the website terms of use, your manipulation of Digg’s content rankings constitutes tortious interference with Digg’s agreements (i.e. its website terms of use) with the Digg users involved such activity.

Digg hereby demands that you immediately cease all attempts to have Digg users manipulate or otherwise affect the Digg service. Please provide us with written confirmation of your understanding of this matter within the next ten (10) days and assure us that the foregoing demands will be met.

This message should not be construed as a waiver of rights, an offer of settlement, or reliance on any specific facts or legal theories. Digg reserves all of its rights and remedies under applicable law.

If you have any questions or comments, please do not hesitate to contact me at ###-###-####.

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Chris Lynn is a social media specialist, working with clients from the Marketing, Online Advertising, Mobile, Consumer Tech, and Social Media industries. He also edits socialTNT, a blog on new media, marketing and PR.

Over the last couple of months, Yahoo Buzz has slowly built up its features, seemingly setting its sights on top player Digg. Likewise, StumbleUpon has also upped the ante, adding new features to further court the growing social browsing market. While Yahoo Buzz may not yet be “Digg”-able, will it trip over StumbleUpon? Let’s take a look!

First Impressions

Quick glances at the splash pages show big difference on focus.

Yahoo Buzz is definitely a news-oriented site. The topics resemble those you’d find in a newspaper, with Entertainment, Sci/Tech and Politics being the default categories. Clicking on “More” also gives you access to Business, Health, Lifestyle and more.  It’s also easy to browse the “Up & Coming” news stories.

StumbleUpon’s splash page can be a little overwhelming–too many topics across the menu bar and way too many images.  Not really sure where to start.

Sorting based on interest doesn’t really clear the clutter.

Although sorting on list view cleans it up a little, StumbleUpon’s overload is just too much to handle. This round goes to Yahoo Buzz.

Shareability

More and more news sites are incorporating the Yahoo Buzz and Stumble chicklets for easy sharing.  But what happens if the site doesn’t have integrated sharing?

From the Yahoo Buzz splash page, you’ll need to scroll down the page to find the “Submit a Story” button.  Yeah, you have to go back to the Buzz page and copy and paste the link. The original web toolbar, the Yahoo Toolbar, does link back to the Buzz Page, but it doesn’t include a “Submit” option. LAME!

StumbleUpon, on the other hand, has a fully-integrated Stumble bar. The bar allows you to review sites, tag them, share with friends or look at other reviews of the site.  Translation: Uninterrupted browsing!

Submitting to each is pretty easy.  Both offer similar forms: Title, review/summary, category, etc.  StumbleUpon stands out here by offering more than five hundred categories, as well as tagging.

By The Numbers

According to company spokespeople, Yahoo Buzz saw 7.7 million unique visitors to StumbleUpon’s 6.3 million unique visitors in October 2008. Based on traffic alone, Yahoo could be considered the winner–but don’t judge too quickly. These are social sharing sites. Looking at the number of stories or sites submitted tells us a different story.

In October 2008, Yahoo Buzz averaged roughly 20,000 stories submitted per day. Even though it has one million users less than Yahoo, StumbleUpon’s community shared roughly 35,000 per day in October. This landslide in sharing is a testament to StumbleUpon’s easy-to-use toolbar. With more than half a million more submissions per month, Stumbleupon is the true winner in this category!

Final Thoughts

Overall, we prefer the look and feel of Yahoo Buzz.  Its clean design and easy-access menus make it easy to find news stories.  By narrowly defining the types of stories and defaulting to Entertainment, Tech and Politics, Yahoo Buzz is definitely in the running to appeal to a mainstream audience.  Plus, with Yahoo finally linking its properties to create a social network, there is no need to create another profile.

That said, StumbleUpon’s encyclopedia of topics and highly engaged community make it a great place to discover new sites that might appeal to niche interests.  If you have a personal blog, add StumbleUpon bookmarking chicklets.  Because the community is based on a narrower-scope of interests, you are more likely to attract its active members.

Put simply: Yahoo Buzz is like Target and StumbleUpon is your local boutique.  You might go to Target to get the larger items, but you’ll always end up at a boutique if you really want that hard-to-find item.

Which do you prefer and why? Let us know in the comments!

Image courtesy of iStockPhoto, bns124

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The hot rumor today is that Facebook and Twitter held “several weeks of serious talks” about an acquisition recently, which have since come to an end after the two were unable to reach an agreeable price for the microblogging service. Alas, there are greater tragedies.

While Twitter might be the “it” startup of 2008, it somewhat famously has zero revenue. Meanwhile, although Facebook has become the most trafficked social network, its biggest competitor, MySpace, does a far better job of monetizing its users as it evolves into an online media company. What can Facebook do to counter? Instead of buying the hottest startup on the planet, take a look at acquiring companies with real business models that are in need of what Facebook has – hundreds of millions of users. Here are a few ideas that come to mind:

SmugMug

We know that Facebook isn’t just the world’s biggest social network, it’s also its biggest photo sharing site. SmugMug offers a gorgeous interface for organizing photos, but more importantly, offers serious monetization by letting users buy prints, postcards, merchandise, and more. MySpace recently introduced its own options for photo printing, through a partnership with HP.

Imeem (or iLike)

Increasingly, Facebook’s lack of a music service is becoming one of its most glaring omissions. Recently, rumors surfaced that the company was looking to forge a partnership or outright purchase one of the online music companies. iLike already owns the most popular music application on Facebook, while Imeem offers a more popular destination site and widget network. The business model here is obvious: digital downloads, concert tickets, merchandise, and ringtones. Their big competitor: MySpace Music.

Jaxtr

This startup provides web-based VoIP services, allowing users to create widgets that can be embedded on blogs, websites, and social networking profiles. While all seemed to be rosy as the company passed 10 million users and introduced premium services to make money, Jaxtr recently laid off staff and saw its CEO resign.

What’s the play for Facebook? Like other web-based VoIP services, while member-to-member calling is free, calling out to landlines or cell phones costs money. Since Facebook would be spending $0 on user acquisition (typically a huge cost for VoIP services), that revenue drops right to the bottom line.

An Ad Network

For a while, speculation had it that Facebook would launch its own behavioral ad network, where users’ profile data would be leveraged to serve ads on participating publishers’ sites. Ultimately, we wound up with Beacon, which just freaked people out and ruined a few people’s Christmas. Nonetheless, this remains a huge opportunity for Facebook, and with an unsustainable number of ad networks out there as we head into an economic slowdown, Facebook could pick up a big network (in terms of reach and impressions) on the cheap, and then insert its own behavioral technology behind the scenes.

Digg

Acquiring Digg would be a bit out of leftfield and probably very unlikely; whereas the other names on this list are services that would integrate within Facebook, Digg is its own massive destination site. However, the two companies are already working together to bring Facebook Connect to Digg. News is the cornerstone of any media operation, and Digg, with Facebook Connect, would simply fit the bill without being a boring also-ran in the world of news aggregators.

Plus, with Google no longer interested, Yahoo building its own social news site (Buzz), and the big media companies all being squeezed by the current economy, there aren’t that many companies that would offer a competing bid. On the other hand, Facebook could potentially build their own Digg competitor, based on an aggregate view of user’s posted items.

Will Any of These Deals Actually Happen?

The Pros: all of the businesses above offer Facebook logical ways to make money. The Cons: None of the above are nearly as sexy as Twitter, and they all come with baggage.

Nonetheless, even if Facebook isn’t worth the $15 billion valuation they used to try and persuade Twitter to do a deal, they are in a far better position than most as the economy slows down. Lots of startups with good ideas and good business models simply won’t be able to gain users fast enough to survive. Facebook can scoop up these types of companies on the cheap, get them integrated, and emerge from the current economic downturn as an online media company with diverse revenue streams. On the other hand, the alternative - not doing any deals - isn’t a bad idea either.

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One of the biggest recent announcements from Digg, and one they put much emphasis on, was the recommendation engine; a system that learns from your digging habits and feeds you stories you might like based on what diggers like you recently found interesting.

After using it for quite some time, like most such ideas, I find it utterly useless. I use Digg in the following way: I check out the front page and the upcoming Technology section for interesting stories. The recommendation engine merely gets in my way, making me go through a couple of extra clicks to get what I want (whenever Digg doesn’t automatically log me in, which is often). The stories that the recommendation engine feeds me seem completely random; standard categorization by topics works way better, and checking only what’s recommended feels like I’m missing out on good stories.

In a way, Digg itself is a big recommendation engine: it’s a bunch of news stories and links selected by wisdom of crowds. The difference, however, is that Digg doesn’t care about my “digging habits;” it doesn’t try to guess what I’d like to read, it works as a collective hivemind that decides what it likes by itself. On the other hand, I’ve encountered many startups which are trying to learn from your web usage patterns and habits, and none of them did anything for me; in fact, the entire idea simply doesn’t seem to work, except perhaps for the most casual user who won’t notice the difference anyway.

This is just my opinion, though. I’m interested in what you think. How’s the recommendation engine working for you? Do you use it? Are the stories it recommends any good? Or do you skip it altogether? Feel free to answer in the comments.

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