Last Friday I wrote a post titled Netvibes Appears to Be Dying. My conclusion was based on downtime by the service, a recent history of repeat problems with the site, concerns about the viability of the start page sector in general and with the Netvibes business model in particular. Anger that this site I depend on was failing me again was a big factor in the post as well.
After making that post, we received a torrent of feedback, most of which was very negative. I also spoke to Netvibes CEO Freddy Mini and he shared with me some facts, figures and perspective from within the company. Based on that conversation I want to revise my statements about Netvibes and to apologize for the angry, caustic tone I took in the post.
Here at ReadWriteWeb we love web startups and we certainly don’t wish any of them, much less Netvibes, any harm. As a journalistic organization, even as a post-objective “new media” one, we should be careful about the tone we take in writing about startups. I didn’t and I’m sorry for that. I was personally angry that an application I depend on was failing me and my concerns about the viability of the company were unduly amplified by thinly veiled venting.
But is Netvibes OK?
CEO Freddy Mini explained that the start page paradigm hasn’t really taken off beyond the early adopter set but remains useful as a driver for sales of the company’s new enterprise and “branded portal” offerings. The company also has enough users that “cost per install” of branded widgets is a meaningful source of revenue.
I expressed disappointment that the customizable start page hasn’t taken the world by storm and Mini said he shared that feeling. I believe that a move away from the DIY start page and toward brand advertisers is a move away from the authenticity of Web 2.0’s original vision. Even the language of “brands” is nauseating; every time an online tool succumbs to a future as a “service for brands,” a kitten somewhere on earth drops dead.
Since starting to offer enterprise and branded products, though, Mini says that Netvibes increased its revenue 4X in the last 3 quarters of 2008. As a writer focused on consumer tech, that business wasn’t evident to me and I didn’t think much about it. The company also cut its burn rate (expenses) by 50% during the same period.
Is Netvibes pinching pennies at the expense of functionality and stability? Mini said that the recent problems were attributable to a load balancer that was replaced yesterday, in part because of our post alleging a connection between downtime and the health of the company. Whether or not the company is making sufficient investment in infrastructure is unclear; presumably time will tell. It’s also easy to imagine resources being shifted whole-scale into sales while the legacy (free) product gets put on life support. I’m sure the start page product helps with some sales, but I presume that enterprise and marketing sales people help a lot more.
Netvibes raised 12m Euros in August of 2006 and hasn’t raised any more money since then. Mini says that while other companies are cutting staff, he’s adding people – specifically sales people targeting brand customers in the US and Europe.
I’m not entirely convinced how well the current path is going to serve Netvibes, but Mini says its enterprise product is far less expensive than competitors like IBM – so maybe they can pull it off. I hope so because I want to keep using the company’s start page product. Not because it’s free, but because it’s a very good product.
The long and short of it is that it appears I was wrong – Netvibes is not going down the tubes. At the same time, I’m not entirely convinced that all is well at Netvibes and I am disappointed about the move away from the original vision and towards a brand-centric direction for the company.
What do readers think about Netvibes these days?
