Perfect timing for the Elton John reference.  If you have been following the online industry for a while, you will notice the cycles that it goes through: start with wide scale portals and slowly build out vertical websites that appeal to a more targeted and relevant audience.  Here are some examples below of how this niche mechanism has been effecting each online market sector:

Ad networks

Online advertising networks started out by segmenting themselves into the products they offered (display banners – Specific Media, behaviorial targeting – BlueLithium, in-stream – Tremor Media, Performance – Commission Junction, et al).  Then they slowly started to migrate to audience specific (niche) offerings (Women’s lifestyle – Glam Media, 18-24 year old males – Break, DIY – Martha Stewart, and even a vertical ad network enabler – Adify).

Social Networks

Everyone knows the names of the mainstream, widely adopted social networks such as Facebook, Myspace and Hi5.  However in the last year there have been hundreds of social networks focusing on a very targeted audience (Baby Boomers – BOOMj.com, Reading fans – BooksConnect.com, Business travelers – PairUp.com, along with niche social network enablers such as Marc Andreessen’s Ning.com)

And now we are seeing that category specific portals are starting to get noticed.  Yesterday was a great day to be a niche travel website.  TripAdvisor announced that they had acquired two such online travel destinations: VirtualTourist.com and OneTime.com.  These acquisitions take TripAdvisor’s monthly unique visitor count to nearly 32 million.  This gives them a sizable portion of the online travel marketplace which I’m sure their parent company, Expedia will continue to leverage in order to expand its own dominance in the travel industry.  “VirtualTourist pioneered the concept of an online travel community, and with the help of over a million enthusiastic members, has created a fantastic travel site,” said Steve Kaufer, founder and CEO of TripAdvisor. “I’m thrilled to have such great companies join our media network, and I look forward to working with the teams to help grow the sites and the community.”

So keep up the good work niches!