Despite an increasing number of Web 2.0 startups going under - just take a gander at an apparently resurgent FuckedCompany.com - many analysts still don't see a bubble on the horizon.

Which may not necessarily be a good thing, as analysts also believe that the Web 2.0 space isn't yet big enough, Red Herring explains. "It's not blowing up enough to be a bubble in the first place," said Peter Cohan, president of Peter S. Cohan & Associates.

In the first three quarters of 2006, venture capitalists pumped over $450 million into Web 2.0 startups. But job cuts at some of these startups have caused venture capital to stop flowing as freely, and many startups are still waiting for their second and third rounds of funding.

Still, some analysts suggest that the innovative players that gained a first-mover advantage, such as YouTube in the video-sharing space, are thriving, whereas imitators are falling by the wayside. A lack of major technological breakthroughs in recent years may also be contributing to a less-crowded Web 2.0 space.