Vistaprint's (VPRT) shares collapsed after the company reported fiscal 4Q earnings and forward guidance that reflected accelerated spending, internal execution issues, currency impacts, and economic pressures on small businesses.

Management placed emphasis on the internal execution and operational issues as the culprit for the missed expectations. Specifically, rapid hiring, with those hires left untrained, and marketing initiatives that had unintended negative consequences, led the company to issue guidance below the Street. Several analysts downgraded the shares following the report, wrongly in our view.

The day of reckoning for Web 2.0 companies is approaching just as surely as it did for Web 1.0. We appear to be about a decade behind Web 1.0, which would suggest that the crash could start next spring.

Not all Web 2.0 companies will fail, just as not all Web 1.0 companies failed: Amazon (AMZN) and Google (GOOG) seem to be doing just fine, and the eventual Facebook IPO will graduate it into this camp as well.

The old tech bellwethers of the 1990s failed to meet the unrealistic expectations investors had of them. The stocks have fared poorly since the market peaked in 2000, but revenues and earnings have generally grown reasonably well. The result is that these stocks, so overpriced a decade ago, can now be considered value stocks. In addition to having low P/E ratios and decent growth, most of these companies have strong balance sheets with plenty of cash.

There is now a new crop of tech favorites. Many of them are expected to profit from the rise of “cloud” computing, and no doubt some of them will. But the lesson from a decade ago is that the big winners are hard to spot ahead of time and if they are all priced for perfection, the safest bet is probably to stay away from them altogether, or perhaps even take positions against them.

By Leena Rao

AOL CEO Tim Armstrong hinted that this was coming, but this morning Google (GOOG) and AOL announced a five-year renewal of the search deal between the two companies. Google will continue to power search across AOL’s content network and properties. The partnership will be expanded to include mobile search and YouTube.

Networking gear maker Cisco Systems (CSCO) has offered $5 billion for the Internet telephony company Skype, TechCrunch, a leading Silicon Valley blog, reported recently. The deal, if successful, would derail a planned initial public offering from Skype and redraw the battle lines in the lucrative market of video communications. Skype is reportedly looking for a valuation of $5 billion.

Google (GOOG) was also rumored to have considered making a bid for Skype, but antitrust concerns prevented the search giant from making an actual offer, the blog reported. Ironically, Google added a free phone-calling service to its Gmail email service last week, a move that was seen as putting the company in direct competition with Skype.

Skype’s attraction lies not only in its video-conferencing capabilities but also its huge worldwide subscriber base. Skype has a registered user base of 560 million, but most of its revenue is generated from nearly 8 million users who pay for its inexpensive computer to landline and mobile phone calling services. Keeping that in mind, it will be interesting to see how Cisco justifies a $5 billion price tag for a company which had revenues of $406 million in the first half of the year and a GAAP profit of $13 million. eBay (EBAY) sold Skype to a group of private investors, led by Silver Lake Partners, for about $1.9 billion.

Yesterday Apple (AAPL) announced their new version of AppleTV. The day before, Amazon (AMZN) announced they will be streaming TV and movies.

With new studies showing 58% of TV viewers had streamed or downloaded TV within the last six months (45% watched or downloaded TV content at least once a week), which company will win the WebTV battle? Here’s the tale of the tape:

I have followed United Online (UNTD) for a bit of time now. I still like their FTD online property, and I think their dialup business is capable of spinning off quite a bit of free cash flow before it ceases operations. (I am fairly indifferent to classmates.com). By traditional valuation metrics, the stock is still underpriced, but I have noticed that their free cash flows are declining quarter by quarter, presumably as the result of the loss of some after-sale marketing programs. I think the company will eventually find a new equilibrium, but on the other hand, I wouldn't care to place a bet on what level of free cash flow that equilibrium will be.

Last quarter, they reported net income of $14 million, depreciation of $14 million, and capital expenditures of $10 million, producing estimated free cash flows of $18 million. If we use this figure as the basis for their full year outlook and capitalize it at a rate of 10x, we get a value for the company of $720 million, which is more than 50% above the current market cap. However, the quarter before last, free cash flow was $21 million, and the quarter before then $23 million, and the quarter before that, $26 million. Fortunately, as the result of their disappointing earnings announcement and not-optimistic outlook, the company's market cap dropped by roughly $90 million when they announced last quarter's earnings, so it seems that the market is more or less instinctively walking the price down until the company regains cash flow stability. So, hopefully those of us who are waiting for that moment will not see the apparent bargain price pulled away from us prematurely.

When Wired Magazine published its controversial “Web is Dead” cover story a few weeks ago, many were quick to dismiss it as sensationalist. This was undoubtedly based on a misunderstanding. The Internet per se was not pronounced dead by the article, but rather websites as a dominant delivery mechanism for Internet content. And dead was probably not a word to be taken literally, but maybe an adjective like vulnerable comes closer to the mark. In fairness to the critics, had the article’s title been rendered in the future tense, the statement would have seemed more like a prophecy than a pronouncement, and this may have been easier to accept. Regardless, watching Steve Jobs Wednesday afternoon unveil his lineup of new products, all of which are based on or supported by apps rather than web destinations, the Wired article begins to hit eerily home.

Of all the products and features unveiled by Apple (AAPL) yesterday afternoon, the one that may turn out to be the biggest news is Ping. Not to take away from the elegance of new iPod models, or the sleekness of the new Apple TV device, but neither of these offerings is ground-breaking for Apple. If anything, such a comment speaks to the high expectations that the company has established in the marketplace and the high standard to which we now hold it. And although Apple TV must still prove itself after an initial false start (while other alternatives have since begun to offer more or less similar consumer possibilities), there is good reason to believe that Apple TV will make an impact. Given the company’s trademark brilliance at product launches, updates, relaunches, redesigns – notwithstanding a so-called “antennagate” hiccup that nobody now even remembers – Apple TV could well become the standard that the iPod, iPhone, and iPad have already become.