This is becoming something of a hot topic around the blogosphere. Well, it should, since the blogosphere’s a child of Web 2.0 and all that. I felt I should at least share my views on the subject, clarify my stance and opinion on the collapse of the 2.0 bubble:

Thank God.

What’s really collapsing here is the funding available for new startups, existing startups, and startups in general. Them fuckin’ startups. Just how many startups? Plenty of startups rely on startup VC funding, and if those startups don’t get startup VC funding, they shrivel and die.

Here’s an idea of how many startups we’re talking about.

I don’t know about the rest of the world, but the ever-increasing amount of “Web 2.0″ services was plain ludicrous. I counted at least 5 ways to share files online in the last 30 minutes - FTP (old-skool, but effective), dropbox, drop.io, email (ffs), any one of the numerous collaborative servers out there (basecamp being one of them).

How many social networks? Thousands (no, really - Ning’s done a fantastic job at inflating the space). And all of them are near carbon-copies, with the same share-your-photos-and-videos-and-blog functions.

Then microblogging. Twitter is the most obvious, followed up by Jaiku and Pownce and Plurk and Identi.ca (and all the other variants of Laconica out there), and a few Indian startups I completely forgot about, and then some more that I’ll probably never hear of.

Free tip: Surprisingly, setting your Gtalk status is an effective way to microblog - especially when it shows up in your lifestream. Never really considered that, to be honest.

So where does this collapse lead us? The most superfluous of the lot should vanish. “Superfluous” being single-purpose services with no real leadership, and whose sole purpose was probably to gain access to VC funds. Those blue-sky ideas that never would have survived without the VC funding about to be pulled out from under them.

Next up are the services with no business model, or no way to finance their ongoing operations. Twitter’s apparently still figuring out how to monetize, as is YouTube and Facebook. They call it a “lot of untapped potential”, but whether or not they find the tap is another story.

The services that ultimately survive will be the ones that add significant value, or are in other ways capable of sustaining themselves financially. I reckon one of the most useful services out there is Zamzar (online file conversions) - and if I was in a position to purchase a premium account from them (ie. in the possession of a MasterCard), I wouldn’t even think once.

Other services that should survive are the ones that can slash their operating costs tremendously, yet still function. As in, move to lower-class offices, fire the staff you don’t need, hire people that care enough about the job to work harder for less, cut back on the 5-star 3-course meals, that sort of thing.

Finally, should any failing services be able to serve - in some arcane way - as an advertising platform, Google might consider buying them. That’s probably a good place to go, since Google’s in a position to survive this whole downturn thing with nearly no effort. People want to spend less and get more results - AdWords is good at that.

I’m also hoping that this Great Deflation will root out the gems in this crapheap we call Web 2.0. And maybe give impetus to fledgling local social startups. If its bye-bye Facebook intl, Blueworld’s ready to fill the gap. That sort of thing.

And there you have it - my semi-brainless Social Media waffle for Saturday. I guess I need to stop procrastinating now, but please - if you have any opinions to share, do! I’d appreciate the extra distractions ;)