In the past, AOL was the only social networking site, charging a monthly access fee for their email, IM, and internet services. Competition was virtually non-existant which made AOL a little too comfortable in the industry. As competition became more threatning, not charging for their email and internet services and computers having internet explorer or safari already installed, AOL could not keep up and had to make their services free.
Google and Yahoo became the leaders in this new era and have been trying to compete with one another for a number of years. The introduction of My Yahoo and iGoogle along with IM features on these sites allows users to maintain social networking without having to go on different pages or sign onto different accounts - which is a huge advantage and extremely convenient for users. The only problem with this is for Google and Yahoo. They do not charge for their features which makes it hard for them to turn a profit. Advertising is the only way for these sites to make money- but with 4 out of 10,000 users only clicking on the ads, it is not the best way for companies to advertise their products, so i wouldnt be suprised if they choose to put their funds towards other means. It will be interesting to see where the next generation of social networking will pop up.
