TotalCIO

Apr 21 2011   2:09PM GMT

What does it mean that Wal-Mart is buying social media company Kosmix?

Linda Tucci Linda Tucci Profile: Linda Tucci

When I read the news that Wal-Mart is buying a small software company specializing in social networking, thoughts swirled. How they swirled! Kosmix upsets the Wal-Mart cosmos. All that stuff about social media and networking ushering in a third wave of capitalism that I reported on last year was so not over the top, my editor’s skepticism notwithstanding.

I thought about how quickly a capitalist giant can transmute, if it wants to. Wasn’t it just yesterday that Wal-Mart was called out for promoting fake blogs — or to put the company’s fine point on it, paying real folks handsomely for generating positive PR? Kosmix has developed a concierge platform that filters information for people from social networking sites. Never mind brainwashing customers with mercenary social media — Wal-Mart wants to know you by your online social networking habits. So, the Kosmix acquisition has implications for retailing and for social networking, or what’s being called social shopping.

But mostly I was thinking when I read this news, what a heady mix! Kosmix’s founders are Venky Harinarayan and Anand Rajaraman. Silicon Valley royalty, they operate in an entrepreneurial world apart from the one that spawned the entrepreneurial genius behind Wal-Mart. The pair’s previous venture, Junglee, was bought by Amazon.com for a reported $250 million.

Part of the business folklore about Wal-Mart is its policy of bringing store managers to rural Bentonville, Ark., its headquarters, to be steeped in the Sam Walton ethos. Not so here. Not so now. According to reports, Wal-Mart will come to Kosmix, setting up a new group called @WalmartLabs, which will be based in Silicon Valley. What does it mean? “Upsetting the cosmos,” as my editor would say, is probably overstating it, but IT really is making the world flat.

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