Website buy-up won't be the Last.

Buying Last.fm was a smart move for CBS, but creating revenue could be more tricky

The $280m deal to buy Last.fm is not the first of its kind and it won't be the last.

Boasting more than 15m users worldwide, the East London-based service has natural appeal to a traditional, US broadcast corporation such as CBS.

It is a cunningly inventive service. While its recommendation system can throw up unexpected curveballs, that is part of its charm. And, ultimately, the idea of serving music fans not only what they like, but what they don't know they like, is brilliantly simple.

But CBS's interest in the operation echoes the attraction which Google felt for YouTube and News Corporation for MySpace over the past couple of years. When News Corp. paid $580m for MySpace in autumn 2005 and Google paid $1.65bn for YouTube in autumn 2006, neither service could boast revenues to truly justify such a fee.

And, even today, "revenue" continues to be the elephant in the room. The common argument is that you can't enjoy the kind of traffic and market dominance that YouTube and MySpace claim and fail to generate some revenue. The question is whether they can generate enough revenue, quickly enough to justify ...