Blogging Tools market is heating up AND how to make a WEB 2.0 Community work!

There are all kinds of problems with blogging monetization, but no problem getting bloggers to sign up for tools to try and monetize their traffic and/or data mine their traffic.

In the nine months I have been blogging, I have experimented with many tools, they include:

BlogFlux MyBlogLog Sitemeter BlogBeat Feedburner andf many more.

Today, Feedburner bought BlogBeat . Smart move for Feedburner to get deeper into blog stats and data mining. The combined entity will be a force. Feedburner won’t last much longer without a bid from a bigger media player. Brad blogs here about the acquisition by Feedburner -one of his portfolio companies.

I really like MyBlogLog and check in often. They have a cool networking and community set of features they just launched and Fred Wilson , Brad Feld and Trader Mike (at my nudging) are trying it out on their sites. I think it is cool to see who is on or just visited. Like a local coffee store feeling.

Here is the thing about a good network. Feedburner has a great USER BASE of LOYAL FOLLOWERS. Adding the community makes sense. They are not starting a community as the model. It is an extension OF the model. WINNER!

Same goes for MyBlogLog . Killer service with a new community built on top of a solid user community. WINNER. I will be shocked if they do not announce being acquired SOON, or have a VC funding to announce. If they don’t – or even DO – I hope they call me to get in on it.

This space is small, from a venture standpoint, but HOT.