Is MySpace in Danger of Fading into the Sunset?

Last week, MySpace (NWS) deposed its co-founder, Chris DeWolfe. It was inevitable.

While MySpace is a big force in entertainment and social networking, there are certainly some big issues. The Google (GOOG) ad contract expires next year. Plus, Facebook and Twitter are making lots of headway.

OK true, according to a piece in BreakingNews, News Corp’s Rupert Murdoch can still say he made a killer deal. After all, he shelled out $580 million for MySpace in 2005 and since then, the site has collected $1.6 billion in revenues. In the Web 2.0 world – where monetization is elusive – this is a grand-slam home run.

In fact, back in 2005, MySpace had roughly 14 million monthly users; now, the figure is 126 million.

Now, the temptation is for MySpace to go up against Facebook and become the dominant social network.

But, I think this would be a mistake. Instead, MySpace has proven that it can leverage its hipness, especially in music. So, why not do the same in video? No doubt, this would be a big boost for News Corp, where there is lots of synergy. Actually, it could be a way to pump things up with Google – which is also looking for ways to monetize its YouTube video platform.

Comments

[Linda Nelson:]

If MySpace wants to win back all the filmmakers that have abandonned it's site, they need to treat filmmakers as well as they treat musicians. You can't even find indie filmmakers on MySpace because they are buried three menu layers down. Who's bright idea was that? Every filmmaker I know has migrated to Facebook that really embraces real relationships between companies and the community.

MySpace is just a different animal and was like a playground for people to make fantasy identities. You never really know who you're dealing with. How can a business hypertarget a fake demographic? Facebook encourages real people to make real profiles and deal with real businesses and this makes for a differenty type of social media experience.

There was a time when we didn't have a choice, there was only MySpace and we worked hard to build up a sizable database of "friends", but once there was a choice to build a real community and engage with that community, the game changed. I still use MySpace and think they are trying to adapt, but right now, my advertising dollars are going to go to Facebook, where I know who's going to see my ads.

I still think MySpace is fine for music, as they really push music and musicians, but it would take a major overhaul for MySpace to get the filmmakers (and their followers) back. Also, Facebook is a lot more appealing to a wider demographic - even people's Grandmothers are active users. They would never go near MySpace. It is what it is and maybe MySpace will have to be happy with a young, music oriented crowd - it works for that.

Apr 28 10:40 AM