If YouTube and FaceBook are worth $1 billion, and Google $120 billion, then MySpace should demonstrate value of $10 billion-$20 billion within a few years. This audacious claim is justified if one believes (as we do) that MySpace demonstrates:
- Raw, unprecedented user [and] usage growth
- Massive international appeal
- Scale enough to become an intellectual property distribution powerhouse, and
- A management team with the experience and credibility to solve difficult technical, copyright and creative issues.
We believe media investors may not fully appreciate what has already been done with MySpace or what may lie ahead.
Rohan goes on to say that MySpace is looking to generate revenue four ways:
- Display ads, including video
- Performance-based deals with direct response marketers
Rohan says the company is sold out on video ad inventory; he says CPMs for “pre-roll” ads on a premium show run as high as $35-$40.
He also says MySpace has significant international growth opportunities: the U.K., he says, is adding 25,000 profiles a day and served 1.5 billion pageviews last month; Australia has 2 million unique users and served 1 billion pageviews.
Rohan also writes that the company has internally developed a mobile application for MySpace that will be launched within 3-4 months “with one of the bigger carriers in the U.S.”
News Corp. shares this morning are down a penny at $20.57.