The battle of the startup conferences is in full swing today, with DEMOFall08 up against TechCrunch50.

I’ve shared my thoughts previously on my issues with the marketing pitch for TechCrunch50, that it’s a great conference damaged by a hate filled marketing pitch, where there is room in the market for both DEMO and TechCrunch50.

The constant pitch from Arrington and Calacanis has been that TechCrunch50 is about overcoming what they term as “the payola” of DEMO, where the best startups are featured by a selection criteria based on merit, not their ability to pay.

That may be the case, but how do you explain Ashton Kutcher’s BlahGirls in the first session?

The one thing right about BlahGirls is the name, because Blah is the idea. It’s a celebrity gossip site, with some basic animation thrown in for good measure. There is some basic interactivity with the cartoon characters, which at an extremely long stretch might qualify it as being different. But seriously, the best 50 new startups in the land, and a celebrity blog is on the list. Either the state of startups is so extremely poor in 2008 that this is what’s left in the final 50, or payola has been replaced by letting a site in only because it is backed by a C-List celebrity that is only there to get extra press for the conference. It’s fairly obvious which one it is.

Now I have absolutely no issue with Kutcher and his startup being picked for the conference, and the marketing angle of having him there has obvious benefits for the conference as a whole, but when you set a conference up as being a holy grail of startup events, one of purity where payola has been replaced by merit alone, giving a spot to third rate celebrity blog run by a celebrity is an EPIC FAIL in credibility. Given the choice of “payola” or a dodgy gossip site, I know which one I’d pick.