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Microsoft-backed social network gets walloped

Wallop, which started as a Microsoft research project offering a business model that echoed of virtual-world avatars and debuted at the Demo conference two years ago, shuts its doors.

A would-be social network called Wallop has shut its doors, according to a message on the home page.

"Thank you for being part of the Wallop beta social-networking site," the message reads. "We really appreciate your feedback and support. The beta period will end on September 18th, 2008--after that date, you will no longer be able to access your account."

But Wallop wasn't just another tale of crushed Silicon Valley dreams. The site, which once aimed to compete with the likes of MySpace, had backing from none other than Microsoft.

Microsoft hadn't invested in Wallop in the traditional sense, but it was Microsoft researchers who built the technology that powered the site and then spun it off as a standalone business.

In 2005, the software giant announced an initiative to license the products of its research labs to select start-ups, one of which was Wallop. It launched Wallop at the Demo conference in 2006, offering a business model that echoed of virtual-world avatars: you'd pay for modifications to spruce up your profile.

Wallop had also raised a round of Series A venture funding from Bay Partners in 2006.

Obviously, it never really caught on: Wallop was never talked about in the same sentences of even third-tier social networks. As we saw with the demise of Yahoo Mash last month, big-tech backing is by no means a guarantee of success when it comes to social networking.