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Social Networking - Thursday, May 15, 2008

Comcast Buys Social Networking's Plaxo - Nobody Gets It

Online address book Plaxo announced today that it has been bought for an undisclosed amount by Comcast. Plaxo has been around the block. It was co-founded by Sean Parker - former Napster pin-up. The Mountain View-based startup was funded by Sequoia Capital, among others. The site reported 15M users October 2006.

The original Plaxo idea was novel. Plaxo provides automatic updating of contact information. Users and their contacts store their information on Plaxo's servers. When this information is edited by the user, the changes appear in the address books of all those who listed the account changer in their own Plaxo books. Last year, we saw the launch of Plaxo Pulse. The service enables sharing of content from multiple across blogs, photos, social networking services, rating services, etc. Users can share and view content according to categories like friends, family or business network.

Today we learn that Comcast has paid an undisclosed amount for Plaxo. We think that Plaxo has its aggressive partnership approach to thank. Plaxo has partnered with Google's OpenSocial, AOL and last year Comcast. All of these deals created familiarity which eventually led to a buyer.

Reading posts around the Net, the consensus seems to be befuddlement. What will a cable company do with a social network? Since when did cable co's like Cox (which recently bought Adify) and now Comcast get into speculate Internet M&A?

Comcast and Plaxo did a lousy job of posting logic for the deal. The obvious explanation is that Comcast runs one of the largest ISPs and Plaxo can help to provide glue for the Comcast Internet community. Comcast also says that it plans to use Plaxo for cable TV programming. To which commentators like ZD shrug.

The comment here is: "I’ll be really curious to see how social networking and the TV mesh. In theory, Plaxo on your TV sounds interesting. In reality, I just want to veg. TV can be a social experience, but typically involves a few folks in the room and a few beers. I’m not sure diversions like social media is going to be welcome by your average television viewer." Are you high old man? Have you taken notice of audience participation programs like American Idol? Folks, especially young ones, want treat their TVs just like the do the Net. So the deal makes total sense to us. But as Comcast subscribers, we are very interested to see if the two can work well together.

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