What is MySpace?

MySpace is a social networking website offering an interactive, user-submitted network of friends, personal profiles, blogs, groups, photos, music and videos internationally. Its headquarters are in Beverly Hills, California, USA, which is owned by News Corporation, which has its headquarters in New York City.

5.2. Past, Present and Characteristic

5.2.1. Past

eUniverse (which in 2004 changed its name to Intermix Media) created and marketed the Myspace website in 1998, and was launched in February 1999, providing the division with a complete infrastructure of finance, human resources, technical expertise, bandwidth, and server capacity right out of the gate so the MySpace team wasn’t distracted with typical start-up issues. The project was overseen by Brad Greenspan (eUniverse's Founder, Chairman, CEO), who managed Chris DeWolfe (MySpace's current CEO), Josh Berman, Tom Anderson (MySpace's current president), and a team of programmers and resources provided by eUniverse.

The very first MySpace users were eUniverse employees. The company held contests to see who could sign-up the most users. The company then used its resources to push MySpace to the masses. eUniverse used its 20 million users and e-mail subscribers to quickly breathe life into MySpace, and move it to the head of the pack of social networking websites.

Shortly after launching MySpace, team member Chris DeWolfe in its first business plan

suggested that they start charging a fee for the basic MySpace service. Brad Greenspan nixed the idea, believing that keeping MySpace free and open was necessary to make it a large and successful community.

Some employees of MySpace including DeWolfe and Berman were later able to purchase equity in the property before MySpace, and its parent company eUniverse (now renamed

‘Intermix’), were bought in July 2005 for US$580 million by Rupert Murdoch's News Corporation (the parent company of Fox Broadcasting and other media enterprises). Of this amount, approx. US$327m has been attributed to the value of MySpace according to the financial adviser fairness opinion.

5.2.2. Present

Since early 2006, MySpace has offered the option to access the service in different regional versions. The alternative regional versions present automated content according to locality (e.g. UK users see other UK users as "Cool New People," and UK oriented events and adverts, etc.), offer local languages other than English, or accommodate the regional differences in spelling and conventions in the English-speaking world (e.g. United States: "favorites,"

mm/dd/yyyy; the rest of the world: "favourites," dd/mm/yyyy).

MySpace is also looking at expansion into Korea, Greece, South Africa and Turkey.

5.2.3. Characteristic

There are some characteristic of MySpace:

1. While the "Space" in MySpace refers to cyberspace rather than outer space, the principals of the company clearly exercised "rocket scientist" type creativity in building their business. They designed their service to maximize the degree of creativity that their users would be able to enjoy in customizing "their space" on the

Internet frontier.

2. MySpace embraced a love of music and music fandom that its core audience (primarily Generation Y individuals in the 16-25 age range) is strongly passionate about. MySpace's tie in to the world of music has enabled it create a degree of passion amongst its users that is usually reserved for rock bands.

3. MySpace designed their business to continually talk to, listen to and solicit feedback from their users.

4. MySpace understood that creating a community means more than just getting lots of people to sign up and create profiles. They had to provide the tools to allow them to interact in rich ways while online. They have continually improved their service and added new features and new ways to interact.

5. MySpace made a decision not to try to be everything to everyone... MySpace is very coarse, and much of the content on the site would be offensive to many in our society.

But from its inception, MySpace decided not to censor any content except for explicit nudity and hate speech. And the "wild wild west" edginess of MySpace is a large part of its appeal to those that love it and spend much of their lives interacting with others through it. While the appeal of MySpace extends to many well beyond its core audience in terms of age, it is also worth noting that there are many for whom MySpace will hold no appeal whatsoever, and it is most certainly not an appropriate place for those under the age of sixteen. If MySpace had tried to be something for everyone, it would most likely have failed to be anything to anyone.

5.3.[24] Business Profile

By May of 2006, MySpace had reached around 20 million registered profiles, it was adding an average of more than 75,000 new profiles to its system each day, and it had reportedly surpassed Google and Hotmail to become the fifth most active site on the Web in terms of page views per month (according to comScore Media Metrix).

MySpace was one of the most interesting companies to look at, because the business model had the potential to be every bit as significant in terms of social impact as Yahoo, Amazon, eBay, and Google have been. MySpace allowed people to connect in fundamentally new ways, and had the ability to change the infrastructure of our society in a truly significant manner. In July 2005, it was announced that Intermix and MySpace would be acquired by Fox Interactive Media (a subsidiary of Rupert Murdoch's News Corp) for $580 million, adding more than $70 million to Intermix's market capitalization. The company employs 300 staff and does not disclose revenues or profits separately from News Corporation. NewsCorp recently signed a search deal with Google, through which Google promised $900 million over 3-years (about

$25 million per month). Before this deal, MySpace was bringing in less than $3 million a month in advertising revenue. Although its message reaches millions of consumers each day, the site has not been attractive to advertisers.

The 100 millionth accounts was created on August 9, 2006 in the Netherlands and a news story claimed 106 million accounts on September 8, 2006, and the site reportedly attracts 230,000 new registrations per day. As of February 3, 2008, there are over 300 million accounts.

5.4. Business Model

By understanding and delivering value to the customer, a company creates brand equity,

which translates to value for the company. In order to understand a social network’s value to the consumer, we must analyze the structure of its existence. As mentioned, in MySpace’s initial state, its focus was on promoting record and ticket sales of independent artists in the LA area. However, its membership base has become so broad that its focus on amateur musicianship has been blurred, and its purpose has become a more general one of personal expression and content sharing. If this is true, we can classify MySpace as a type of P2P network, much like Napster or other file sharing communities. Users are in control of the site’s content, providing and sharing intellectual capital, networking, and often generating revenue for themselves – virtually for free. MySpace’s “liberation” of content has proved a valuable practice in the short-run, in that it has attracted a wide and varied base of members from an elusive demographic with a great deal of buying power. By offering free content, the site has empowered not only its users who act as Suppliers, in producing content, but also those who play the role of “ Information wants to be free.” MySpace, like Napster, encourages people to sample music they wouldn’t ordinarily spend money to check out. This encouragement perpetuates the marketing buzz that attracts and engages even more MySpace users. Thus, value to the customer provides the opportunity to add value to the company. But value to the company does not always translate to dollars. Once marketers have reached and engaged consumers, they must track the impact the word of mouth is having on the brand's bottom line. In the case of internet sites such as virtual communities, this generation of revenue is difficult, due to the fact that they’re not actually selling anything. In the case of MySpace, the attempt at generating revenue is inadequate because they’re actually giving their product away. While this may have started as a great strategy for MySpace, gaining the community millions of members in the short-term, the company is not being forced to adapt their business model for survival in the medium term.

In order to sustain its operations, MySpace has been adapting its revenue model and working to keep its “product” desirable. It seems feasible to charge users either subscription or

incidental costs, but customer loyalty only reaches so far, especially in a market environment as volatile and “clickable” as the internet. If members become irritated by the company’s decision to charge them, they may take advantage of other online options. We must keep in mind this demographic’s power to influence others in the social network.

The business model of MySpace:

1. MySpace's new management is focused on develop maintaining the customer base while adding revenue generation. This sounds simple enough, but generating revenue is a rather difficult task in today’s Internet environment. Gone are the days of connect-time revenue splits or simple e-commerce. Internet sites are in competition with one another for revenue and traffic.

2. MySpace is a breeding ground for word-of-mouth marketing: a community of Y-generation consumers with tremendous buying power, who look to alpha-consumer peers to dictate their purchases. With a network of 110 million members, MySpace has the potential to be a valuable marketing tool for perspective third parties. The difficult part is figuring out how to harness this media for commercial gain.

3. One tactic MySpace has adopted is selling its members’ profile information to third parties. As stated in the website’s privacy policy:

4. As it stands, MySpace still maintains its revenue stream primarily through banner advertisements. And as we know, because most marketers are still caught in the “brand awareness” bubble, such marketing techniques are still being measured by cost-per-thousand (CPM) metrics, whereby campaign success is based solely on

“counting eyeballs”.

5. MySpace has begun to integrate advertisers as members of the online community, and to provide them with marketing tools necessary to generate revenue for their companies.

This has proved especially profitable for MySpace, as ad revenue seems to increase boundlessly.

6. MySpace get revenue sharing from entertainment industry, e.g. MySpace movie, MySpace music video, MySpace TV(the same concept like Youtube).

7. MySpace ringtone(6 downloads per month for $5.99; $0.99 / download)

After all, what company would want their brand image tied with questionable content, public scandal, and cultural controversy? But with the reach and influence of the network, there are certainly opportunities to bring in the cash.

5.5. Features and Services

There are some features in MySpace:

1. Moods

Moods are little emoticons that are used to depict a mood the user is in. The feature was added in July 2007.

2. Blurbs, blogs, multimedia

Profiles contain two standards "blurbs:" "About Me" and "Who I'd Like to Meet" sections.

Profiles also contain an "Interests" section and a "Details" section. In the details section,

"status" and "zodiac sign" fields will always display. However, fields in these sections will not be displayed if members do not fill them in. The only Profiles also contain a blog with

standard fields for content, emotion, and media. MySpace also supports uploading images.

One of the images can be chosen to be the "default image," the image that will be seen on the profile's main page, search page, and as the image that will appear to the side of the user's name on comments, messages, etc. Flash, such as on MySpace's video service, can be embedded. Also there is a "details" section which allows the user to provide personal information on the user such as his/her race, religion, and sexual orientation. Blogging features had been a part of MySpace ever since Spring 1999.

3. Comments

Below the User's Friends Space (by default) is the "comments" section, wherein the user's friends may leave comments for all viewers to read.

4. Profile customization (HTML)

MySpace allows users to customize their user profile pages by entering HTML (but not JavaScript) into such areas as "About Me," "I'd Like to Meet," and "Interests." Videos, and flash-based content can be included this way. Users also have the option to add music to their profile pages via MySpace Music, a service that allows bands to post songs for use on

MySpace.

5. Music

MySpace profiles for musicians are different from normal profiles in that artists are allowed to upload up to six MP3 songs. The uploader must have rights to use the songs (e.g their own work, permission granted, etc). Unsigned musicians can use MySpace to post and sell music, which has proven popular among MySpace users. MySpace music has been around since it's debut in Fall 1998 and the first original artists to sign up to MySpace occurred in December 1998.

6. Bulletins

Bulletins are posts that are posted on to a "bulletin board" for everyone on a MySpace user's friends list to see. Bulletins can be useful for notifying an entire, but usually a portion of the friends list (depending on how many friends are added), without resorting to messaging users individually. Some users choose to use Bulletins as a service for delivering chain messages about politics, religion, or anything else and sometimes these chain messages are considered threatening to the users, especially the ones that mention bad luck, death, or topics similar to

that.

7. Groups

MySpace has a Groups feature which allows a group of users to share a common page and message board. Groups can be created by anybody, and the moderator of the group can choose for anyone to join, or to approve or deny requests to join.

8. MySpaceIM

In early 2006, MySpace introduced MySpaceIM, an instant messenger that uses one's MySpace account as a screen name. A MySpace user logs in to the client using the same e-mail associated with his or her MySpace account. Unlike other parts of MySpace,

MySpaceIM is stand-alone software for Microsoft Windows. Users who use MySpaceIM get instant notification of new MySpace messages, friend requests, and comments.

9. MySpaceTV

In early 2007, MySpace introduced MySpaceTV, a service similar to the YouTube video sharing website. MySpaceTV is now in beta mode, and will be probably be launched as a separate site in either 2008 or early 2009.

10. MySpace Mobile

There are a variety of environments in which users can access MySpace content on their mobile phone. American mobile phone provider Helio released a series of mobile phones in early 2006 that can utilize a service known as MySpace Mobile to access and edit one's profile and communicate with, and view the profiles of, other members.

11. MySpace News

In the month of April 2007, MySpace launched a news service called MySpace News which displays news from RSS feeds that users submit. It also allows users to rank each news story by voting for it. The more votes a story gets, the higher the story moves up the page.

12. MySpace Classifieds

Full service classifieds listing offered beginning in August 2006. Has grown by 33 percent in one year since inception. MySpace Classifieds was launched right at the same time the site appeared on the internet.

13. Other features

Features such as MySpace Sports, MySpace Books, MySpace Horoscopes, MySpace Jobs, and MySpace Movies, MySpace Ring tones are now currently available.

Chapter 6

Comparison of Friendster, Facebook, and MySpace

6.1. Compare from the business model sides.

Business models are perhaps the most discussed and least understood aspect of the web. There is so much talk about how the web changes traditional business models. But there is little clear-cut evidence of exactly what this means.

In the most basic sense, a business model is the method of doing business by which a company can sustain itself -- that is, generate revenue. The business model spells-out how a company makes money by specifying where it is positioned in the value chain.

Some models are quite simple. A company produces a good or service and sells it to customers. If all goes well, the revenues from sales exceed the cost of operation and the company realizes a profit. Other models can be more intricately woven. Broadcasting is a good example. Radio and later television programming has been broadcasted over the airwaves free to anyone with a receiver for much of the past century. The broadcaster is part of a complex network of distributors, content creators, advertisers (and their agencies), and listeners or viewers. Who makes money and how much is not always clear at the outset. The bottom line depends on many competing factors.

Internet commerce will give rise to new kinds of business models. That much is certain. But the web is also likely to reinvent tried-and-true models. Auctions are a perfect example. One of the oldest forms of brokering, auctions have been widely used throughout the world to set prices for such items as agricultural commodities, financial instruments, and unique items like fine art and antiquities. The Web has popularized the auction model and broadened its applicability to a wide array of goods and services.

6.1.1. Friendster.com

Their strategies include earning money from advertising, subscriptions and transactions that take place on their Web sites.

6.1.2. Facebook.com

Their strategies to earn money are:

1. Display ads: accounts for most of its current revenue through an advertising outsourcing deal with Microsoft (CPM $0.30) ($300 CPM/ 1000 impressions).

2. Sponsorship: the sponsorship of groups seems to be the major potential source of future revenue ($300,000 for a 3 month presence, up 200% in June2007 vs.

February2007), more than 150 companies are already present such as Nike, Victoria’s Secret, etc.

3. Gifts: limited edition gifts for sale at a low price ($1).

6.1.3. MySpace.com

Their strategies to earn money are:

1. One tactic MySpace has adopted is selling its members’ profile information to third parties. As stated in the website’s privacy policy:

2. As it stands, MySpace still maintains its revenue stream primarily through banner advertisements. And as we know, because most marketers are still caught in the

“brand awareness” bubble, such marketing techniques are still being measured by cost-per-thousand (CPM) metrics, whereby campaign success is based solely on

“counting eyeballs”.

3. MySpace has begun to integrate advertisers as members of the online community, and to provide them with marketing tools necessary to generate revenue for their

companies. This has proved especially profitable for MySpace, as ad revenue seems to increase boundlessly.

4. MySpace get revenue sharing from entertainment industry, e.g. MySpace movie, MySpace music video, MySpace TV (the same concept like Youtube).

5. MySpace ringtone (6 downloads per month for $5.99; $0.99 / download).

6.2. Compare from Site features (applications), business profile and search engine.

Table 6.2.1

Search Engine Google Google Facebook

Applications [25] 243(keep Users (Estimated) [30] 58 million [31] 68.9 million [32] Over 60

from Year

Note People are

*A voice greeting is your 30-second personal introduction. This is your chance to let other singles hear what you have to say. You can talk about your idea of a great first date or share an interesting fact about yourself.

**A video greeting is a 30-second video starring you! This is your chance to let other singles see and hear you. You can talk about your idea of a great first date or share an interesting fact about yourself.

***The interest function is a way to let other member know that you are interested in them, or

***The interest function is a way to let other member know that you are interested in them, or