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Web services was a chimera. They only worked if people wanted the service that used it. The sideshow carnival of inappropriate personal relationships and unusable business development agreements don't play. They lead immediately to ridicule. Only a madman would risk this kind of ridicule.
Oh, and since the Internet is still at heart technology (witness Google) first, maybe he should talk to people who have done real technology companies and let them do the tech and not compete with them on the tech. He should be doing the business. And we're back full circle to product, market, team.
Of course, there's always an Internet version of the Brooklyn Bridge...