We always try to answer all legitimate questions from individual readers, but after thinking about these three specific ones, I wanted to share my answers with all our readers…..so everyone can get a good feel for how we’re seeing things. Just remember they’re opinions unless otherwise noted.

1) The latest on challenger boats–real co. or scam?

Challenger Powerboats (OTCBB: CPWB) isn’t a scam - just a disappointment. The factory and boats are real, and they’re well-respected within the boating world. They just aren’t selling enough of them. I believe that problem can be overcome, but it’s apparently going to take longer than we first thought….maybe until 2008 to really get things rolling. What do investors do in the meantime? Your discretion.

Ideally, I feel the company needs to do $12 million (annually) to prove their mettle. Why $12 million? That’s what the pre-merger combined sales total was between Challenger and IMAR in 2006.  Anything beyond that is growth. Anything less than that is contraction. I still think it’s possible for CPWB to pay off eventually…..just not sure when - perhaps not soon enough. It does concern me that they don’t even seem like they’re even close to being on track to reach $12 million by year’s end.

2) CPNE.OB???I am shocked. You have recommended Commerce Planet (CPNE.OB), I believed in it from September, but I am shocked with price in last three weeks. Any comment?

Commerce Planet (OTCBB: CPNE)….good company - not so good stock. I think the early ‘exponential growth’ phase may be winding down, which is a tough act to follow. Also, I’ve heard consistent whispers that this company can get new customers, but just can’t retain them. There are only so many willing buyers out there, and then you run out of them. Still though, this company can and does put up some nice sales and earnings. I think CPNE may be undervalued, but unless the rest of the market agrees, it doesn’t matter - the stock won’t budge. Momentum is half the battle….a battle that CPNE is losing right now. As far as this stock is concerned, I think a rebound with upside follow through is possible, but watch the chart more than the news. But, I don’t look for the same kind of growth going forward.

3) Dear Editor What’s with WBTO?????? I believe this was one of your prior recommendations. Any idea why the bottom is falling out? Thank You.

I believe the bottom is falling out for Web2 Corporation (OTCBB: WBTO) shares because eventually you have to achieve some sort of monetary success. For months now we’ve heard about how much revenue Web2 could draw, or what kind of money they could make. Yet, we’ve not yet heard how much they’ve actually done, which makes me think they’re not doing much in the way of sales - if anything. They were late on their SEC filing as well, which is a red flag. Maybe the company is prepped to make a fortune, but they really need to go ahead and do it rather than just talk about it. Till then, I’m not surprised the stock is headed lower.

Other thoughts

Yeah, it’s definitely a tough time to be involved in the small cap world right now. These names have not traded well recently, but then again, no small caps have. I think it’s important to distinguish between general market tides and individual stock weakness. The recent overall weakness may be what’s wrong with CPNE. I’m not sure about CPWB. And WBTO? I think it may have been headed lower no matter what was going on in the market.

Be sure to check out Saturday’s edition for more recent small cap perspective.

With a handful of newer companies to cover now, it’s time to clean out the closet (so to speak) and officially drop coverage on some of our older names - just so we can stay focused. There are only two we feel we need to pare right now….Web2 Corporation (OTCBB: WBTO), and Siena Technologies (OTCBB: SIEN).

Web2, despite a nice run up to $2.47 in December, could never really draw an interested crowd. Since peaking then, the stock has walked all the way down to a recent low of $0.95. Granted, shares are currently trading at $1.27 - pushing off of that 95 cent level. Perhaps it’s support. We did, after all, use that level as a springboard in November before the December rally.

The thing is, we just don’t see enough gusto to say the buyers are interested again…..not that they ever really were. Perhaps it’s because they’re now several weeks behind on their annual filings. What’s up with that? We don’t know exactly, and we’d prefer not to find out what it is the hard way.

Note that we’re putting WBTO in our past while it’s still within our trading entry/exit parameters. Our target was/is $3.79, while we suggested a stop of 89 cents. We’ll leave it up to you to decide which of these is likely to be found first, though we’ll also mention you can adjust either as you see fit. 

Siena easily has one of the coolest race and sports book technologies any casino could ask for. Plus, the company can basically create any sort of audio/video technology you could imagine. More than that, we think eventually this company could be great. However, it just doesn’t seem like now is the right time.

One of the key issues we see is - despite being ultra-cool - the market for what they do might be fairly limited. And in Siena’s case, that problem is augmented by focusing almost exclusively on opportunities in Las Vegas, where they’re based. Maybe if they could branch out and do other things it would open a few more doors. Until then, we’re going to move on to other ideas, after having it on our radar since April of last year.

That said, if you have any final thoughts or parting comments/observations about these two stocks, please post them here. And, if anybody out there ever has any worthy news to share on WBTO or SIEN in the future, feel free to let us know.

No big deal, but we saw yesterday where a couple of 10K’s (annual reports) you may be interested in had been delayed. One of them was for Challenger Powerboats (OTCBB: CPWB), while the other was for Web2 Corporation (OTCBB: WBTO).

The Challenger delay we’re not concerned about at all. The company has been very vocal about the kind of results they’ve been getting recently, and we’re pretty confident their Q4 of last year is good for roughly a million bucks in sales, with no earnings yet. Between acquiring a company, initiating a boat-show marketing plan, and merely rebuilding the company, they’ve got enough to do already. So, we’re not sweating the postponement.

Web2, on the other hand, is a curious delay. We’ve mentioned a couple of times that their Q4 was likely to be the first ’sign of life’, as most of their better revenue-bearing sites were only launched late last year. Ideally, we should start seeing results in last quarter’s numbers….even if the progress was minimal. Instead, we know nothing yet, and have no explanation or known reason for the delay. That’s a red flag to us, unless somebody can tell us what the hold up is. For what it’s worth though, the falling stock doesn’t suggest the results are going to be anything to rave about.

Anyway, just wanted to let you know case you were waiting for the year-end figures.

Interesting idea here…Web2 Corporation (OTCBB: WBTO), who will be launching ‘YouGetIt.com’ in thirty days, plans to promote the new site concept between now and then by capturing the whole process on video. Each day before YouGetIt.com is up and running, the latest headaches, milestones, and final touches will be video-blogged for anybody who wants to see all the behind-the-scenes stuff we normally wouldn’t see.

Could be worth a look-see. For more information about the launch-countdown video blog, click here.

By the way (and we hope you were wondering), YouGetIt.com has been described by the company as “a hyper-local, local, and national media like no one’s ever seen it before, allowing a user to take command of online news, broadcast, and content media with one revolutionary new internet application. You want it. YouGetIt!”

In English, it’s a site designed to focus in on a geographical market of Internet users rather than virtual market. There are two dimensions to the site…local browsers, and local advertisers. The browsers should get tailor-made surfing relevancy, while the advertisers can pinpoint ads to a specific locale. For more details, check out this page on the company’s site…there’s a full description there.

Hype aside, it’s actually a pretty novel idea, and a good example of the Web 2.0 philosophy. Better still, it’s got some serious revenue potential if the thing gets traction….seems to be much more effecient at connecting buyers and sellers than most search engines do.

Looks like ‘bricks and mortar’ has switched to ‘clicks and mortar’ for Web2 Corporation’s (OTCBB: WBTO) Chamber of E-Commerce. Already expanding the customer base of its easy-website-building offer, Web2 announced they’re now going to try and get local Chambers of Commerce in the United States to help support the proliferation of the service. By giving local Chambers free use of the site-building tool (and free hosting) for their own sites, the company hopes to showcase what they can do through one of the most legitimate organizations in any community.

We like the idea - a lot. Though we don’t have any specifics on the number of Chambers there are across the nation, we know it’s in the thousands. And, each of those Chambers is closely involved with potentially hundreds - if not more -of local businesses also looking to gain credibility. We just see this tactic creating massive interest in Web2’s E-Commerce solution.

And from the looks of the stock’s chart over the last couple of days, we don’t appear to be the only ones thinking like that. We mentioned on Friday WBTO looked like it was finding support at $1.42, and later in the day, it rallied sharply up to a close of 1.71. Today we’re seeing great follow-through, and it looks like the buying volume is going to be even stronger today. We think this may well be ’round 2′ of the any bigger picture uptrend; the last surge from early December started out a lot like this one….out of nowhere. Once the 20 day average line was crossed though, this thing didn’t look back until it had more than doubled. We’re not saying we’re due for the same again, but we are saying we like what we see so far.

The other thing…..earnings are probably due soon. Could this be an early warning that revenue is finally starting to flow in? We’ll see.

On February 3rd, we mentioned how we thought Web2 Corporation (OTCBB: WBTO) shares might be prepping for a nice recovery move. Ultimately the stock misfired, running up into resistance at the 20 day moving average line, then falling back again. We kept it on our radar though, and perhaps it’s a good thing we did…the stock looks like it’s taking another swing.

Now, mindful of what we saw less than three weeks ago, we’re not suggesting we all pile in just for the heck of it. With the 20 day average at $1.62, and shares at $1.58 as of right now, we think there’s still a big hurdle to cross….one we couldn’t get past just a few days ago.

But, we also like the support being made at $1.42. That’s where we bottomed twice in the last month (once before February 3rd, and once after February 3rd). With that line likely to act as a safety net, the risk profile here doesn’t look too bad. Of course, I think we’d all feel even better if WBTO could get - and stay - above the 20 day line. But, that’s the nature of the beast…not knowing for sure.

Based on the chart, and also knowing Web2’s recent corporate story, we still feel this one could be a pleasant sruprise.

Up and running now since September 20th of last year, Web2 Corporation (OTCBB: WBTO) today announced a twist that we expect to generate even more sales. The International Chamber of E-Commerce - Web2’s easy website building tool - had previously been marketed by a human sales force, who were paid a portion of any monthly subscription fees created by their customers. Now, anybody who runs a website can generate their own recurring commissions by promoting the service via the Internet.  

Materially, the only thing that’s changed is the sales process. The sales agent was a specific person, and usually dealt with prospects fact-to-face. The new sales path will promote the service directly over the web, generating a commission for the site that actually enrolled the new customer for Web2. The pricing and commission hasn’t changed.

Though minor on the surface, we don’t think this should be taken lightly. We can potentially see this small twist making a big difference in this venture’s revenue.

Why? Two key things. In our guess-timate, the average salesperson fronting for the ICOEC (International Chamber of E-Commerce) may have been (1) not necessarily technically skilled enough to promote a website building tool, or (2) geographically limited to a relatively small target market. It may not have been the case every time, but those were the two key potential barriers we saw.

We think the new web-based sales force may have considerably more luck. Why? Again, there are two reasons…..(1) the audience isn’t limited by geography, and (2) the sale of site-building services is already a proven web-based industry. We feel there’s a very good chance that a potential customer could me much more receptive to this sales process than they may have been with a real-live person - self-service is the norm in the niche.

Though not likely to make WBTO an overnight sensation, we do think this is actually a pretty good move for this particular profit center.

For more, click here.

Not that the company needed any help attracting people to the site, but Web2 Corporation’s (OTCBB: WBTO) ByIdia.com just announced an 800% increase in weekly registrations. The vast majority of the increase is being attributed to the site’s $5 million sweepstakes, which only began a little over a week ago.

Do we even need to reiterate what kind of potential there is here? We liken ByIndia.com to a combination of Google, Monster, Yahoo, eBay, and more….only this particular site is a one-stop destination to provide all sorts of Web 2.0 services. Already the #1 search engine specifically designed for the Indian market, it appears as if ByIndia intends to virtually ‘own’ the Internet in the world’s fourth biggest population of Internet users in the world (and likely to be the biggest by 2010).

You can’t go back and do Google, Yahoo, or Amazon over again, but we think Web2 Corporation may well be a similar opportunity.

If the headline got your attention, then you can bet Web2 Corporation’s (OTCBB: WBTO) latest traffic strategy will turn heads too, as they unveil a $5 million sweepstakes for users of their Indian search engine ‘ByIndia.com’.

The goal of the sweepstakes? To cement the site as the premier site among Indian Internet users. The website is already ranked India’s #1 search engine, offering a whole host of features such as blogs, classifieds, video uploading, and online communities - just to name a few. But this sweepstakes? Well, let’s just say we think it could nail the coffin shut on the next nearest Indian search engine competitors.

It’s a big deal primarily because India’s residents are currently the fourth largest group of Internet users in the world, and are on pace to be the largest group of Internet users by 2010. Point being, that’s a lot of traffic….and when it comes to the web, traffic means dollars.

Sorry, the sweepstakes is restricted to citizens of India actually living in India, or in the United Kingdom. But, if you’re looking for a way to make some serious money in a short amount of time, maybe you should consider WBTO shares. With the kind of attention we think this $5 million bounty will draw, we’d expect Web2 Corporation’s ByIndia.com to quickly become a top revenue source for this diverse Internet company. For all intents and purposes, Web2 Corporation is ‘new’, and we think it’s still a great ground-floor opportunity.

Don’t forget, SmallCap Digest offers free stock ideas and market commentary through our e-newsletter. Be sure to sign up today using the link in the top right corner…and don’t forget to respond to the confirmation e-mail. Or, add us to your RSS feed using the link in the left-hand column.

Four month’s after going ‘live’ under Web2 Corporation’s (OTCBB: WBTO) direction, ByIndia.com got something of a facelift today. The site is using a new logo, and the interface is now better-geared for the philosophical Web 2.0 way of thinking.

On the surface you may not even notice these differences. Under the hood, though, the company is ready to rev its search engine. In other words, now that a substantial user base is in place, the company can Web 2.0-ize the site. One of the big advances we see to that end is a single-registration for all of the ByIndia offers (like job search, auction sites, blogs, etc.).

And by the way, not content with the fact that byIndia is now the most-visited Indian search engine, the site’s $5 million sweepstakes starts tomorrow. You can bet that’ll draw even more eyeballs, which for Websites - of course - ultimately means revenue. 

Getting serious about growing the bottom line as well as the top line, Web2 Corporation (OTCBB: WBTO) announced today a move that could significantly help at least the former, and perhaps the latter as well.

By converting some outstanding notes to stock, debt has been reduced by $418,634. As part of the same liability-reduction effort, the company’s preferred stock has been cancelled by the issuance of common stock in its place, effectively lowering its debt obligations by 20%. That leaves $2.3 million worth of debt obligations on the table. However, with the way ByIndia is growing - and by the sheer fact that Web2 was able to make this transaction at all - is a pretty nice sign that the company’s viability rating is moving higher.

Apparently the market likes the news. Shares are trading 10% higher already, nicely rebounding from a good-sized pullback in late December. We expect to see strong technicals follow this company’s story now that a little momentum has been set in place.

Truthfully, we’re not a bit surprised, after reading about its uncanny growth. ByIndia.com, one of the creations of Web2 Corporation (OTCBB: WBTO), is now officially the #1 Indian search engine, according to Web-traffic measurement site Alexa.com. ByIndia’s 800%(+) growth in just three months after its re-launch is - to us - just astounding.

If you haven’t taken a look at WBTO shares, please do so. Speculative they may be, but there’s some real meat to this story that other investors may find very compelling. Be sure to review all of our commentary and focused newsletters too, as they’ll discuss targets, stops, and details on the things we see as critical to Web2 Corp’s success. 

This is the kind of action we feel most shareholders may want to see, and we’re not even talking about the monster gain of 73.7% since we rolled out our target price on December 5th (well, it’s not the only thing we’re talking about).

After discussing the merits of Web2 Corporation’s (OTCBB: WBTO) stock in our December 5th edition, the stock went wild, peaking at $2.26 on the 7th. At that point, the easing back to the close of $1.84 on the 11th may have led some traders to think the move was a one-hit volatility wonder. Well, get ready for round two…the stock has been rallying sharply for the last three days, reaching a high of $2.47 just a few moments ago. Needless to say, the prior high has been breached, so shares are at a ‘new’ annual high for the second time in just six trading sessions.

Now, put the big move aside for a moment - what we’re impressed by is the second surge being made on no news. Our concern about any news-based move is simply how the move may only last as long as the market remembers the news….which isn’t very long in some cases. But the rally over the last three days is on no news whatsoever…..the trading pubic appears to be interested on their own. In a sense, we see it as the critical ’stand-on-its-own’ test…a test which we feel WBTO seems to have passed so far. Better still, we think the strong buying volume and weak selling volume since the 5th points to the same brand of bullishness.

Do we think Web2 Corp. shares will be able to keep moving higher every single day now that it’s become a what we see as a very viable equity? We seriously doubt it. However, based on the action we’ve seen over the last two weeks, we feel the odds of a rebound after any dip are now considerably greater. In our opinion, the risk-to-reward equation may have just tipped well in favor of the reward side.

Capitalizing on what we feel is a broad range of Internet-know-how, Web2 Corporation (OTCBB: WBTO) announced yesterday they’ll be launching a job search site….with a novel twist. Rather than an employer just posting a simple job description, a prospective company can upload a video regarding the opportunity. Likewise, a job-seeker will be able to upload a video of him or herself as part of a multimedia job application.

Your first thought might be that this is just too radical to be of interest to either side of the equation. However, we’ve observed - even in just the last few months - how the use of multimedia (video, audio, with written word) has become mainstream. YouTube and Yahoo Video are just a couple of examples of how Internet users are looking to become more digitally creative. So, we see it not so much as cutting-edge, but rather as pioneering….Web2 Corporation appears ready to lead the way in the next evolution of Web-based job searches. We’ll be excited to see where it all leads.

The service is scheduled to be launched in January, and will be aptly named JobMatchPro.com.  For more on Web2’s newest venture, click here.

In the meantime, it may be worth reviewing our most recent newsletter installment regarding Web2. It included a suggested target and stop price, and preceded 60.3% rally from $1.41 to a high of $2.26. Since then, shares have eased back to $1.84, which still leaves behind a 30.4% gain after that edition was published. 

It was only a few days ago we mentioned ByIndia.com’s traffic growth was astronomical after just being launched in late October, but congratulations are again in order for Web2 Corporation (OTCBB: WBTO). The company reported earlier today their Indian search engine and web portal is the fastest growing site in that particular category, according to Alexa.com.

Are we surprised? No, not really. Web2 had been honing the ’stickiness’ of ByIndia.com, as well as getting it promo-ready, for months. Within 20 days of its October 16th launch, the Alexa ranking has shot up from 750,000th to 12,745th (among all globally monitored sites). And, less objectively, we think the ByIndia.com site is easily more user friendly and fun to use than the next nearest competitor.

As for what’s next, we feel it’s going to be more of the same as time progresses. In other words, this rapid footprint expansion could potentially make ByIndia.com not just the fastest-growing Indian search engine, but the outright most-visited Indian search page. It’s currently ranked third in the category, and is gaining on the #2 site pretty quickly.

In terms of what it might mean to the bottom line, we can’t emphasize enough how important we think it is to be ‘best in breed’ in whatever category you’re in. If ByIndia.com can offer a potential advertiser the most visits, in our opinion, they can pretty much write their own ticket within the Indian market. And based on today’s response with the stock’s chart, it appears other investors agree. WBTO is up nearly 20%, trading at $1.40 after closing at $1.17 on Friday. The rally seems to be threatening a long-term resistance area around $1.60 too, so we feel this chart is well worth watching now, if only to see if this short-tem move materializes into anything more.

For more on the news, click here.

Don’t forget, SmallCap Digest offers free stock ideas and market commentary through our e-newsletter. Be sure to sign up today using the link in the top right corner…and don’t forget to respond to the confirmation e-mail. Or, add us to your RSS feed using the link in the left-hand column.

After its official launch just three week’s ago, ByIndia.com has started to draw a crowd…so to speak. The owner and developer of ByIndia.com, Web2 Corp. (OTCBB: WBTO), announced today ByIndia.com’s Alexa ranking - a site popularity measurement service - had risen from 750,000th to 12,745th. Considering there are literally millions and millions of Websites out there to compete with, that’s a very impressive move. Alexa also indicates 85 out of every 1 million Internet users visits ByIndia.com. Again, it may seem like a tiny fraction (and it is), but it’s actually very impressive by Internet traffic standards. For an idea of how quickly this site is becoming popular, only 20 out of every 1 million Internet users visited ByIndia.com last week. Once they got to the site, the number of pages viewed per visitor increased by 50% since the launch.

We think this is a good sign for the enterprise. While there’s still no word on revenues yet, we feel being able to gather ‘eyeballs’ as they have is at least a step in the right direction. We’re looking forward to seeing how the site continues its development.

For the full press release, click here.

Earlier today, Web2 Corporation (OTCBB: WBTO) announced their 3rd quarter results. The company posted $180,000 in sales compared to $168,000 for the same quarter last year. The loss came in at $446,000 versus a $156,000 loss last year. The per-share loss was 2 cents for both quarters.

Where was the excess baggage? The cost of revenue basically doubled from $99,000 to $196,000, while the selling and administrative expenses were raised from $128,000 to $238,000. On a quarter-over-quarter basis, everything else looked mostly comparable.

As always, though, there’s far more to the story than just the numbers…..

If the term ‘Web1000′ is new to you, that’s probably going to change soon. Web2 recently acquired Web1000.com - an e-commerce website. The increase in the cost of revenue is largely attributable to that acquisition. Fortunately, Web1000 is a revenue-bearing enterprise, so the expense associated with buying it (cost of revenue) and running it (administrative exoenses) will presumably be offset by its sales going forward. To what degree they’ll be offset, we still don’t know for sure. But, we assume it will end up being an asset rather than a liability.

As for the big bucks supposed to be drummed up by the Chamber of E-Commerce and ByIndia.com, keep in mind these quarterly results were for the three months ending on September 30th. As of that time, only the Chamber of E-Commerce was ‘open for business’…..and it had only been live for 10 days.

Since then, the Chamber of E-Commerce has had some time to gain momentum, ByIndia.com has been launched, and there’s another division scheduled for its unveiling later this month. So, while their Q3 may have been basically flat, you have to keep in mind it should have been flat. We think the real test will be in seeing what kind of improvement they can make in Q4.

For the full results, click here. 

The news really shouldn’t come as a total surprise…Web2 Corp. (OTCBB: WBTO) said on October 4th they were going to do it, and we reiterated that in our newsletter the same day. Well, here it is, in all its glory. The ByIndia.com we were touting then is now ‘live’. The revamped site now includes features like social networking, classifieds, video uploads, and more Web2-ish widgets.

And the point? Our only goal then - and our only goal now - is to fully explain the opportunity Web2 Corp. is facing. By extension, it’s also an opportunity for potential shareholders.

While we don’t want to belabor the point as deeply as we did on the 4th, we do want to remind you of three high points. Any and all could make a very strong case for WBTO shares gaining a lot of popularity in the foreseeable future.

• Social networking is a viable venture. The fact that MySpace.com thrived at all is proof of that. And, the News Corp. (NYSE: NWS) purchase of MySpace’s parent company - to the tune of $580 million - should provide some perspective on just how serious this business is. There is no dominant social networking offering in India…until now.
• Video uploading sites are a viable venture. Google’s (NASDAQ: GOOG) $1.65 billion purchase of YouTube.com was no accident; clearly somebody sees some serious value in Internet-based outlets for digital media. Again, there is no site focused on user-made video in India…until now.
• Did we mention the Indian population is the fourth-largest set of Internet users in the world (behind USA, China, Europe)? By 2010, it’s on pace to become the largest set of Internet users worldwide. It’s also the second largest general population on the planet, and will soon (2007) surpass China to become the largest.

The upside potential is incredible, perhaps even a little unfathomable, as the entire industry is propagated on the other side of the world (at least for most of our readers). Clearly the dollars up for grabs could be the order of millions, which is exciting for Web2 - and shareholders - to say the least. The incredible part? It’s only one of four key divisions the company operates.

Surely by now you’ve heard…Google (NASDAQ: GOOG) bought YouTube.com yesterday, to the tune of $1.65 billion. The move has gotten mixed reviews by analysts and the public. Of course, we have to put our two cents worth in on the issue. We also have to discuss the implications - direct or indirect - the acquisition could have on companies like Ckrush (OTCBB: CKRH) and Web2 Corporation (OTCBB: WBTO). It’s also worth noting Web2 has already released their public response to the YouTube purchase. It was fair, but definitely not an endorsement. You’ll see below. But first, our take…

Good or bad for Google? We think it’s still too soon to say, to be honest. It really all depends on what they intend to do with it. Most experts feel, and we don’t disagree, that integrating the YouTube offer into the current Google offer will seem like patchwork…and perhaps a bit of a misfit. Most Google users like the clean interface, minimal graphics, and low-hype approach. YouTube is clean-looking, but its targeted audience - avid bloggers, gen Xers, and gen Yers - may not be the same as Google’s.

The other downside is simply that YouTube is still unprofitable, and isn’t guaranteed to ever be solvent. It’s an ad-supported site, but that may not enough anymore. An investor asking what the revenue model is may not necessarily like the answer - it would take a lot of clicks and impressions from YouTube users to create any serious dollar amounts.

Like we said, we’re not saying it was a bad move. What we’re saying is how Google chooses to integrate and monetize it is the key to its success. We just don’t know if it’s the right fit. We do know that $1.65 billion is a lot of money though

That said, there’s a huge implication for Ckrush Entertainment shares. Its online community site Livemansion.com, in many respects, mimics YouTube. LiveMansion also mimics MySpace.com. Both MySpace and YouTube were acquired by media gaints for giant sums of cash. See the connection? Whether we’re right or wrong about the misfit is irrelevant…online communities and self-made video sites are in demand. Ckrush has not once directly said they are interested in LiveMansion being acquired by anyone else (although they haven’t denied it either). However, there’s a clear industry trend in place now, and Ckrush’s LiveMansion could indeed look like the answer for a big company feeling the urge to jump on the bandwagon. Never count on an acquisition, but don’t be shocked if it happens.

Bill Mobley, Web2 Corporation’s CEO, released his own thoughts on the acquisition…and we don’t disagree with them. In short, he doesn’t see how Google can successfully integrate YouTube. He contends that organic and internal growth of web media and sites is the only viable way for an internet-based company to expand. Otherwise, you just get confusion…especially for the advertisers who may not even understand what they’re getting from Google anymore. He compared it to the Yahoo (NASDAQ: YHOO) acquisition of Broadcast.com a few years ago…which ended disastrously, primarily because it’s tough to integrate an acquired company once both entities have been established within a particular category.

That’s why he addressed the issue (and yes, well before the MySpace and YouTube purchases) with the recent simultaneous launch of several Web2 divisions, which are related, yet distinct…and even a little self-serving. All four major divisions are indeed integrated as he described, and all can seamlessly grow together. That was the point we were trying to make when we first featured WBTO in the September 20th edition of the newsletter. While we’d never say never about the Google/YouTube partnership, we also think Mobley has a better finger on the pulse of where the web is going. We shall see.

To see Mobley’s complete release, click here.