With all of the hype surrounding Web 2.0 companies like Facebook, Flickr, and Twitter, it’s easy to forget that lots of Web companies still fail. Here are 10 that failed – and why.
BY Rachel King

The Web is an extremely fickle place. A Web service can be hot today, and dead in the water tomorrow. While there’s no true science for determining exactly what makes one stick while another languishes, there’s a lot to be learned after one fails. Considering a startup? Here are 10 recent failures to add to your case studies.

How Many Calendars Do We Need?
After the hype around RSS (really simply syndication, which makes it easy to subscribe to blogs and websites through a reader or your Google or Yahoo start page), RSS Calendar launched to enable the same type of functionality, including easily sharing your Outlook calendar with others. But, with calendars already built into Windows and Mac OS, and Google’s calendar just a keystroke away, it’s hard to imagine why you’d need another. In June, 2007, the company called it quits and auctioned itself off on eBay for $50,000. It was later purchased by Lookout Software.

Lesson Learned: If people aren’t ready for RSS — both Forrester and Pew report that only 5% to 6% of the U.S. population actually use it — then they’re not ready for an RSS calendar.

A Case Against HyperLocal Content, Sort of
MyKinda launched last September as an Eastern European country-specific blog network, covering business, politics, culture, lifestyle, science and technology in local languages and some English translations. The site failed to draw in enough interest or advertising revenue. Eventually it started falling behind in payments to writers and ended up folding in February.

Lesson Learned: It’s expensive to acquire good niche content, especially if you don’t already have the site visitors to earn advertising revenue from.

It’s Tough to Beat Craigslist
Microsoft jumped into Craigslist’s pool and realized it couldn’t keep its head above water. Launched in 2006 as a new free listings service, Windows Live Expo, will be discontinued on July 31. Its draw was enabling users to buy and sell merchandise, discover local events, find new jobs, or find a place to live. Products on Expo were listed by postal code, offering users the option to search for items within a 25-mile radius of their location. Even with its services being tied into other Microsoft products, like the ability to limit listings to e-mail or IM contacts, the site never came close to the recognition and popularity of Craigslist.

Lesson Learned: If you’re going to take on a well-established competitor, you better offer something special.

Even Shy People Would Rather Go Out
MingleNow promoted itself as a virtual nightclub meant to help wallflowers feel a little more at ease and socialize online. Founded by BlueLithium in 2005, and later bought by Yahoo!, the community enabled users to connect with others who frequented the same venues. Social networks, however, have never truly been Yahoo!’s strong suit. The company previously dismissed another social network, Mixd, realizing it was time to start letting go of dead weight.

Lesson Learned: Yahoo! doesn’t have the wherewithal to focus on another social network — it already has enough. Besides it acquired BlueLithium for its advertising network.

Photos are for Sharing
Launched in October 2006, ProtectMyPhotos, an online photo back-up site actually made it past the one-year-mark, closing down by December 2007. The site allowed users to upload their photos to back them up online, either saving hard drive space, or keeping them safe should a horrific event happen to their computer. An additional feature offered was photo restoration, but this was already available on other well-known photo websites (i.e. Snapfish) and at most drug stores, which offer online photo production as well. Plus, with the popularity of Flickr and Google’s Picasa, which offer social networking, ProtectMyPhotos didn’t really stand out from the crowd.

Lesson Learned: The online media storage space is already overcrowded, and if your competitors go social, you probably have to go social.

The GPS of Instant Messaging
One of the first location-aware instant messaging platforms, Meetro had quite an edge over other IM platforms, and provided compatibility with the most popular messaging platforms, including AIM and ICQ. The program would determine the user’s physical location and inform the user of contacts in the same vicinity. However, the application was never 100% in determining correct location, and the site shutdown in May due to technical issues and the team’s loss of interest. The company’s founder, Paul Bragiel, said, “the service simply wasn’t that interesting.” Bragiel also told TechCrunch, “People (myself included) just felt beat up. We knew that fixing these issues would involve a complete rearchitecturing of the code, and people just weren’t excited about the idea enough anymore to do it right.”

Lesson Learned: Sometimes it takes awhile for a good idea to become a strong company. Though the idea might be ahead of its time, stick with it and bring people to the team that have a passionate interest in the project.


Money Can’t Save Everyone
Akimbo, which once raised $56 million in funding from sponsors like Cisco Systems and AT&T, launched in 2002 as a hardware-based video-on-demand (VOD) business. The site allowed members (with a subscription service) to choose programs and download them over a broadband connection, either to a computer or to a TiVo-like box. In a last ditch effort, the company was re-branded as a media center rather than a hardware-based company in February, but management problems at the top brought the VOD provider down soon after. Thomas Frank replaced founder Josh Goldman as CEO of the company, and rumors circled that Frank had a less-than-warm reception. As of May 23, the entire staff had been laid off except for three to wrap-up the company collapse. Many insiders were stunned by the rapid closure, considering the amount of fundraising Akimbo drew in and the site’s potential. But with the brand and management changes, it was hard for consumers to even connect with the company or understand what it was about.

Lesson Learned: Even lots of revenue and sponsorships can’t save your company if it isn’t properly managed and branded.


Get Off the Couch
Like a Google Maps for television listings, Couchville attempted to make program listings as easy as to navigate as possible. All a user had to do was enter their zip code and cable service provider and the listings for their area appeared. Viewers could drag the page up and down, left and right to scroll through listings, and a vertical red line sat on top of the current time listings. And the service was free. Simple and effective, yes, but it’s also pretty easy to find out what’s playing by switching to the channel with the TV’s guide function or by visiting TVGuide.com, which already has the brand and name recognition. Besides, there are other services that offer innovations such as video previews.

Lesson Learned: Ease of use doesn’t always mean a product is necessary.


Phony Loopholes
Who needs a landline when you have a cell phone? Well a cell phone can’t do everything, and it’s certainly costly to make international calls from one. Yak4Ever, once called AllFreeCalls, was resurrected in May after being shut down in February by its rural service provider. Thanks to a loophole in Iowa telephony law that allowed the company to provide free international calls, users only had to dial AllFreeCalls, punch in the international number they wanted to reach for a completely free international conversation. But the Iowa-based companies, including Great Lakes Communication Corp. and the Superior Telephone Cooperative, shut AllFreeCalls down after reported pressure from larger telecom companies, who by FCC law had to pay for the international calls because of the Universal Service Fund. Yak4Ever was essentially the same with a new rural operator except the user had to register international phone numbers with the company prior to making any calls. Who has time for that?

Lesson Learned: A business can’t survive on a government loophole.


Streaming Failure
Sonific was a streaming music widget that enabled users to embed free, licensed music onto their blogs and social network profile pages that didn’t necessarily support or offer music widgets. Yet due to the constraints imposed by the music industry with its limited and expensive licenses, and demand for free company equity in Sonific, the company was unable to sustain itself. Prior to Sonific’s shutdown, co-founder and CEO Gerd Leonhard said in a statement that the company didn’t want to take the copyright infringement route in order to stay afloat.

Lesson Learned: Before you get into the online music streaming business, you have to have your partnerships in place.



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