Chocolate and Gold Coins

Wednesday, October 26, 2005

What Is Your Blog Worth?

There is a bit of blog silliness going around about valuing blogs based on Technorati Rank. I read about this first on Om Malik’s blog. You can see an example on the side ofPatrix’s Blog (the George Washington picture) and Technorati blog, (I might be the first to link to this sad blog). Apparently a big group of blogs was bought out for an outrageous price and Tristan Louis determined that at this price each link is worth somewhere around $564.

Now think about that. Did my five seconds of labor above create $564 in wealth to Patrix? Well, I had linked to him before, but what about Om Malik? This post on Desipundit would be worth easily $100,000 to the collective blogosphere. Obviously links cannot, in the margin, be worth anything because they are essentially costless to produce. You could hire people at not much cost to create blogs and link to other blogs and, in effect, “print up” links like counterfeit money all day long.

But it is something that lots of people thought enough about your blog to create a link to it, without any remuneration involved. That is the curious paradox here. The links are valuable because there is no market for them and they are scarce. If you could buy them, then they would be nearly worthless.

But maybe another way to think about it is that a link is valuable if it is in the context of a genuine article. If someone was inspired to write a genuine essay based on your piece, that is gold. But again, it is valuable only because that person had no incentive to do so besides his own admiration of your work.

While the Technorati metric works okay for now as a way of ranking blogs, it could easily be corrupted once people try to price a blog using this metric. Really, the only metric that matter is ad revenue.

But, for a week anyway, I will enjoy the thought that my humble blog is worth $61,500. Now that I have crossed the 100 link threshold, I want say "thank you" to everyone who has linked to my blog at some time:

(It feels nice to print up counterfeit money).


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