Myspace’s Poor Earnings.

February 12, 2007 — 1 Comment

Myspace’s Monthly Advertising Figures

Am I the only one who is less than impressed that a site with a 150 million users is pulling a measly $25 million a month? Myspace pulls in roughly 40 billion pageviews a month and they’re barely pulling in $100 million a quarter in revenue? As an advertiser that would make me worry; think about how little an impression is worth on Myspace. Think about how many of those must not even be genuine eyeballs at the screen, but error messages, glitches, landing pages, obfuscation, and poor design. Honestly, I’m surprised that an investor as disciplined and value-driven as Murdoch would accept this mediocrity.

I don’t mean to get into some design digression, but I don’t even remember the last time I looked at someone’s profile. I check my messages, friend requests, bulletins and leave. Which I think serves as a warning to designers, webmasters and owners out there: Value quality over quantity. All we ever hear about Myspace is how many users it has, about it’s stellar growth rate and apparently manifest destiny to rule the Internet. But when you look at the numbers, the site is abysmally dysfunctional. I remember reading somewhere that Weblogs Inc does a million plus in revenue a month, and you know their traffic is nothing compared to the big social networks. But they’ve figured out their audience, and how to market it to them. They ooze efficiency and maximize profits. I think Myspace almost has that old media mindset of believing that hugeness is the only avenue to profit. We all know that The Long Tail disproves that in a very real way. And Myspace is and will pay the price–hits are becoming less and less rational, and all the harder to come by. Like Hollywood they seem to think that a blockbuster is the only reasonable goal, wholly ignoring the fact that perhaps a series of smaller, niche successes might be a better route. I think you need to start looking at the opportunity costs of trying to be THE site on the Internet. The real dilemma that webmasters are faced with are: Is it better to have a plethora of fickle, peripheral users or a core audience of dedicated niche?

I think the answer is the latter. And as Chris Anderson said, the money of the future is then in the aggregation thereof.

Ryan Holiday

I’m a strategist for bestselling authors and billion dollar brands like American Apparel, Tucker Max and Robert Greene. My work has been used as case studies by Twitter, YouTube and Google and has been written about in AdAge, the New York Times, Gawker and Fast Company.

One response to Myspace’s Poor Earnings.

  1. I just got done posting about the types of earning opportunities I see Facebook missing a bit of. I don’t think anyone in social networking has the “idea right” yet. They seem to do well in building the community, but aren’t very forward thinking into monetizing it.

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