Articles

The MySpace Economy

21/12/2006 Internet Culture

Is the global phenomenon that is MySpace simply a smoke-filled common room for millions of teenagers, or a revenue machine that generates millions of bucks for corporate giants? Ian Harris reveals the truth behind the MySpace economy

“$580million for that?” Everybody remembers how they first heard of MySpace. For some, it was when the Arctic Monkeys first graced a Sunday newspaper supplement. For most, it was when news broke that Rupert Murdoch’s News Corporation paid half a billion dollars for a crudely designed social networking site that few outside teen cliques had ever heard of.

MySpace’s dominance

MySpace didn’t invent social networking, but its anything-goes attitude and roots in the LA music scene soon saw it overtake established rivals Friendster and Facebook. While MySpace isn’t unassailable (Bebo has a larger UK membership), the social networking ship can be said to have set sail. But just because it’s too late to do a ‘me too’ MySpace doesn’t mean that web entrepreneurs can’t profit from the social networking phenomenon. With its 107 million-strong membership growing at a rate of 230,000 a day, MySpace presents lucrative business opportunities – MySpace economy, if you will. Many see MySpace not as a website, but as a platform.

MySpace templates

The most common MySpace cash-in lies in offering free templates to help users overhaul their profile. MySpace gives users enough design rope to hang themselves (so long as they don’t cover the ads). Managers at Friendster would sanitize its profiles. “They had no room for fakesters” says founder Tom Anderson. “If a dog or a city or an idea had a page, they would delete it. People said, I’m going to go to MySpace. I can do what I want there.” But while a lot rides on having a snazzy profile, the intricacies of MySpace’s CSS-based coding system is beyond much of its hard-partying user base. This feeds the popularity of sites such as Pimp MySpace (www.pimpmyspace.org) offering cut-and-paste designs. These sites monetise huge traffic by deploying swathes of camouflaged Google AdSense links and pop-up windows imploring visitors to access more templates in return for a range of ‘free’ trial offers.

Photos

But the so-called ‘MySpace economy’ is more than just banner-farm template sites. There are plenty of start-ups piggybacking the platform by offering widgets and technologies that spread like wildfire though MySpace’s millions of users. RockYou (www.rockyou.com) is a popular tool for turning photographs into smooth, transition-laden slideshows. It’s massively popular on MySpace, where users make use of the service to show off their party pictures. Another site that has risen on the MySpace jetstream is photo-sharing service www.Photobucket.com. www.Flickr.com might attract more Web 2.0 attention, but it’s Photobucket that’s king of the castle, occupying a 43.84 per cent market share compared to Flickr’s 5.95 per cent according to web metrics firm Hitwise. Look at MySpace and it’s not difficult to see why: most people use the site to host photographs. Hitwise reveals that clicks originating from MySpace account for most (56 per cent) of Photobucket’s traffic.

YouTube, spyware & widgets

Another obvious MySpace beneficiary has been YouTube. The ‘broadcast yourself’ service, which shows 100 million videos a day, is thought to be worth between one and two billion dollars. While its success is a result of many factors, much of its popularity can be attributed to MySpace, whose users quickly adopted it as a way of sharing video. Such was the take-up that, for a brief period, MySpace banned YouTube from profiles.

With MySpace’s garish profiles a legendary eyesore, the social networking phenomenon also presents webmasters with plenty of opportunity. The MySpace mania is an additional revenue stream, and for Pearse Street Consulting (myspace.com/myspacedesignbiz), it’s a lucrative ‘add-on’ when pitching for new business.

Another ‘industry’ targeting MySpace is the spyware racket. Adware merchant Zango distributes its technology via MySpace profiles. Affiliates post videos encoded in Zango’s proprietary format and receive a bounty when viewers agree to the pop-up inviting them to install the codec. (Viewers are then subjected to adverts whenever they shop online.)

Cool plug-ins are a more respectable way of selling a few tickets aboard the MySpace gravy train. One such tool is Trackzor (www.trackzor.com), a MySpace ‘tracker’ that lets members track all the visits to their MySpace page. Trackzor provides detailed information on surfers, logging their visits and plotting their location on a Google Map.

MySpace marketing

‘MySpace marketing’ is another cottage industry springing from MySpace’s fertile soil. One reason Rupert Murdoch’s News Corporation paid a high price for MySpace was its gargantuan user base – those 100 million users spell a rich source of advertising income, given that young eyeballs are notoriously hard to reach. But marketeers are developing ways of tapping this audience without buying ads: sites such as MySocialMarketing.com have sprung up to sell businesses solutions for mastering MySpace. One trick is to artificially inflate a firm’s popularity by conjuring thousands of ‘friends’ to add instant kudos to its MySpace profile. “We can build your profile’s friend size into the 1000s” offers the site. One way of appearing more popular than you are is to sign up to what has become crudely known as a ‘whore train’. A whore train is a way of gathering fake fiends quickly – you’re given a list of MySpace profiles to add to your friends list in return for being friends with them. Another method of MySpace marketing offered by MySocialMarketing.com sounds familiar: peppering folk’s profiles with spam instead of cheery greetings. “Every comment left is an advert!” screams the site. “By leaving 1,000 publicly viewed comments, your advert has the potential to be seen by an astounding amount”.

MySpace corporate profiles

Big businesses, though, generally skip the subterfuge and go directly to MySpace’s marketing department when they want to reach kids. The site has jumped on the B2B bandwagon itself by branching out into marketing services, as its News Corporation parent looks to recoup the $580million it spent acquiring the site. MySpace’s latest wheeze is selling sanitized profiles to support advertising campaigns. For instance, the character from Crest toothpaste’s US adverts, Miss Irresistable, has a profile boasting 50,050 friends. Brands like Nokia, Honda and Microsoft have their own MySpace hangouts – paying upwards of $100,000 for the privilege. You might wonder why these brands didn’t just register a regular MySpace profile for free. As part of the deal, MySpace weeds out ‘friends’ with questionable ‘off-brand’ names, and allows for more intricate layouts. So, Burger King’s corporate profile (fronted by a gaudy character known as ‘The King’) is peppered with comments like “thanks for the flame-broiled goodness” and “burger king iz tha best”. Any props from the Hamburglar are not welcome here.