The debate over the value of social networks will go on for months and perhaps longer. Operations like Google's (NASDAQ: GOOG) YouTube, News Corp.'s (NASDAQ: NWS) MySpace, Twitter, and Facebook have huge numbers of users. Facebook now has over 200 million users world wide.

But the websites have done poorly finding revenue models. Industry experts say that Facebook will bring in only $500 million in revenue this year and will probably lose money. That sales figure is remarkably low for a business with such a large audience.

I recently saw a presentation from Dan Nye, who is the CEO of LinkedIn. Of course, all the metrics were spiking. Then again, LinkedIn is the place for professionals to connect.

So, this week the firm has snagged $53 million in venture capital. The investors include Bain Capital Ventures, Sequoia Capital, Greylock Partners, and Bessemer Ventures. As a sign of their optimism, the valuation of the investment came to around $1 billion.

While Facebook and MySpace get lots of buzz, I think LinkedIn is a more interesting play. Basically, the company is leveraging user-generated content to build an immensely valuable database. For example, if an advertiser wants to target someone located in California that is interested in Linux systems, you will definitely get some hits. This is critically important. After all, many other social networks have a tough time monetizing things.

Yahoo! Inc. (NASDAQ: YHOO) may end up kicking and screaming on its way to the altar, but still appears headed toward a marriage with Microsoft Corp. (NASDAQ: MSFT).

The latest fling -- which involved rumors this week that Yahoo! was courting News Corp. (NYSE: NWS) in a complicated alliance that also featured private equity involvement -- was shot down in the market almost as soon as it was floated. In the deal, News Corp. would reportedly get a 20% stake in Yahoo! while handing off its MySpace social networking property to Yahoo!

For such a deal to fly, however, Yahoo! managers would have to show its value tops Microsoft's current $31 a share, $44.6 billion offer, or risk a revolt from shareholders and years in the courtroom defending their actions.

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Heard of Snocap? There's a good chance you haven't. And that's a big problem. In fact, according to a report in C/NET, Snocap has laid off about 60% of its workforce.

The company -- which got its start in 2002 -- was the brainstorm of twenty-something Shawn Fanning. His prior gig was Napster, which had a big disruptive impact on the music business.

But Snocap wanted to be different; that is, it wanted to develop a platform to allow file-sharing sites to sell music in accordance with the law. Basically, the company handles such complexities as licensing and e-commerce distribution.

In theory, it's a cool idea. But, in the real world, there hasn't been much interest. This is the case even though Snocap has a distribution deal with MySpace.

Essentially, I think the big problem is Apple Inc.'s (NASDAQ: APPL) iTunes. Simply put, it sucks up most of the attention in the online music space.

And now, according to a post in Valleywag, it looks like Snocap is prepping for a sale. But in light of the mixed performance so far, I wouldn't expect a premium deal.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements

Going.com is an event site with social networking features that is focused on the 20-something crowd (which I guess leaves me out). The company seems to be getting traction, and today it announced a $5 million round of venture capital. The investors include General Catalyst and Highland Capital.

So far, Going.com covers NY, Boston, San Francisco, and Chicago. It has about 500,000 registered users. Compared to biggies like Facebook and MySpace, Going.com is still small-time stuff. But with the infusion of capital, I suspect that won't be the case for long.

I certainly think there's lots of potential for these kinds of focused communities. It also looks like there could be a big mobile play here.

But, over the long haul, I think it could still be tough. I think its inevitable that companies like Google Inc. (NASDAQ: GOOG), Yahoo! Inc. (NASDAQ: YHOO), and Microsoft Corp. (NASDAQ: MSFT) will want a piece of the market. Then again, these companies may just buy Going.com to get a head start.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

With the success of MySpace and Facebook, venture capitalists are ramping up investments in the social networking space. One of the latest deals is a $20 million round for hi5. The lead investor is Mohr Davidow Ventures.

Hi5 has more than 60 million registered users and has a strong presence in global markets, including Latin America and parts of Eastern Europe.

To get some perspective on things, I interviewed Robb Hecht, who is an expert on social networking and operates IMC Strategy Lab. According to him: "If you were an investor and wanted to get in the game on the most international social network, you'd currently invest in Hi5 (not MySpace or Facebook).

"Hi5's not much of a hit in the U.S., but with a fourth the number of users of MySpace and almost twice as many users as Facebook, the site is both gaining deserved attention and funding.

According to a recent story in The Wall Street Journal, it appears that Dow Jones (NASDAQ: DJ) and News Corp (NYSE: NWS) have an agreement in principal on editorial control and protection. While deals can always fall apart, this is definitely a good sign. Rupert Murdoch is willing to write a check for $5 billion and he has desperately pursued the company. In a way, it could be his crowning achievement.

I'm a big fan of the Wall Street Journal and really can't live without it. And the focus on editorial issues probably helps Murdoch. But I still think the valuation is crazy. Even if there are lots of synergies, I can't find a payback. Even potential suitors like GE (NYSE: GE) think the price is just too high.

Basically, it seems that Dow Jones is a trophy asset. At the same time, Murdoch is a genius when it comes to strategic plays. His MySpace deal has turned out to be a brilliant move. And it's no accident. His career has been testament to skilled deal-making.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

MySpace, owned by News Corp (NYSE: NWS)'s Fox Interactive Media, has become the largest social networking spot on the internet, and the company is taking steps to keep it that way by purchasing the photo-sharing site Photobucket for a reported $250-300 million.

Up until now, in order for MySpace users to embed photos and videos into their space, they had to first post that content on outside sites such as Photobucket and YouTube, then embed links to it. Photobucket holds a dominant share of that photo-sharing market (41%) and over 40% of the links to its content comes from MySpace users.

A couple of weeks ago, Fox Interactive Media (FIM) began to block content from Photobucket, accusing it of encouraging MySpace users to embed Photobucket-hosted content that carried an accompanying advertisement. If this was a negotiating tactic, it didn't seem to drive the price down much; News Corp is rumored to have dropped $250-300 million for the site.

The move will allow FIM to keep MySpace customers within the family fold as they upload content, thus avoiding the possibility that while on the Photobucket site they might be lured to try a competitor to MySpace.

FIM also announced a smaller deal to buy Flektor, a site that allows users to prep better user content by editing and mashing up their photos and videos.

While their initial plan is to maintain separate identities for the companies, I'd expect FIM to eventually fold both companies into the MySpace family to create a seamless one-stop shop. It also now has the opportunity to market MySpace to the reported 30 million people that visited Photobucket in March.

While the price paid seems steep, the race to integration has become a sprint, and all the big rollers have bought into the game. It's not a market for the thin of wallet or faint of heart.