Bronte Media

I know. I know. The only constant in media coverage of the Internet industry is the perennial navel gazing question of ‘are we in a bubble?’ Like a broken clock that is right twice a day, people are ever so proud when they are actually right.

I don’t really think there is a financial bubble. Yet. But here are two very frothy transactions that made me say ‘huh’ this morning:

Cox buys Adify for $300m. The company had $7m in revenue last year. But that’s gross revenue.

Without a hint of irony, Adify CEO Russ Fradin pointed out on Techcrunch that Adify is better described as a platform and services company, not a network.

What does that mean for the rest of us? Well platform and services companies get paid less than ad networks basically.

From an early story on the company when it raised its most recent $19m round:

“Adify is only taking 20 percent of what the advertiser pays to the publisher, somewhat less than the 30 percent or higher that others take.”

So the $7m gross is actually $1.4m. But that is expected to grow to $35m (or $7m net revenue) this year. Bravo Cox.

The second bubble alert was Jeff Dachis teaming up with Austin Ventures and $50m to “create an industry leading strategic consulting practice and an enterprise class Social Software-as-a-Service (SaaS) suite.”

What the fuck does that even mean? Do they sell and integrate Microsoft Exchange and Outlook? Install the Cisco phones?