The launch of so-called Open Source Media (no, they're not open source, in fact they try to keep people from even using fair use quotation through a EULA, don't get me started ) is proof that a Blogging Bubble is well underway.

Why? No business model.

Everyone doing a blogging network, whether AOL (Weblogsinc), Gawker Media, Metroblogs, Huffington Post, OSM, you name it -- they're all using a media strategy. And Dana's First Law of Internet Commerce is:

Any strategy based on bulk advertising, based on pure page views, is going to fail. No strategy based on pure star power can succeed, because it doesn't take into account the fact that stars fade and stars emerge. (It's not who you are, it's what you're saying, that counts.)

So, smart guy, what do we REALLY want?

• Reach must be based on content, not a silo, so if I write about politics or e-commerce I'll get into your stack, if my stuff is good. That last is the bit that needs work. How do we know that Dana's stuff is good? Brand doesn't really tell us anything. Sometimes Dana has a bad day.
• Raise per-pageview values dramatically through tags, through targeting, through commerce.
• Consumers will demand interactivity, and intimacy. Any impediment to that will fail.

Frankly, companies like Feedster and Technorati are farther down this road than the Huffington Post. But these firms, too, lack a business model. What's the point of traffic analysis tools unless that traffic has real value?

The Blogging Bubble is not going to hear or understand the need for Web 2.0 functionality (and a merger of functions to create greater intimacy and higher per-page value) until the present media assumptions collapse further. The OSM launch is proof those assumptions haven't even begun to collapse.

Jason Calacanis got $15 million selling Weblogsinc, and he's looking pretty smart right now.