Blogging and social networking are the two trends that have most defined the Internet landscape in the '00s; therefore, you'd think that LiveJournal, which was born just before the turn of the decade and combines blogging and social networking, would have a market capitalization somewhere north of Google's by now. But despite LiveJournal's large and passionate user base, it never quite became one of the giants of the Web 2.0 era.
While it's hard to say why LiveJournal remains sort of an also-ran, it may be a combination of management missteps and a user base that's, well, a little too passionate. Check out the "Controversies and criticisms" section of the site's Wikipedia page for some of the more dramatic blowups. From the perspective of moneymaking, probably the most telling was the incredibly controversial addition of advertising on non-free accounts, a year after management promised not to put advertising on the site.
LiveJournal was purchased in 2005 by Six Apart, the company that makes the MovableType blogging software; two years later, they turned around and sold it to a Russian company, SUP. "Sold to a Russian company" is generally not the outcome that Silicon Valley entrepreneurs dream about.
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