Mathew Ingram notes that Mahalo is preparing for the stiff breezes of the downturn, and wonders whether they can get by on their ad based revenue model:

Regardless of the number, is it enough to get Mahalo the kind of scale that will make it a viable search site? I think Ash has a point when he says that the company’s current strategy pretty much consists of trying to whip together links and a blurb about whatever is hot on Google Trends, and then hope that Google indexes it quickly and it shows up high in search results. Is that a viable strategy? I confess that I don’t really know.

Personally, I'm way, way more skeptical. I've thought for a long time that most of the "all we need is eyeballs to drop ads in front of" entities were doomed; It looks like reality is starting to slap Calacanis around on that score.

Ponder what Mathew says above, too - Mahalo doesn't even directly rely on ads. They have to hope that they get indexed high enough to draw Google searchers, and then hope that some of the ads they run will attract the people who just came by. I find that to be a very questionable thing - it's too far removed from the original heap of searchers to my mind.

I could be wrong, I suppose, but I doubt it. If we're very lucky, the entire ad model will get a serious rethink while things are down.