by Jason Wilk on May 4, 2009
- MySpace’s newly appointed CEO Owen Van Natta officially took over as CEO of MySpace today. He sits at the bottom of a gigantic traffic slope that is Facebook. On a global basis, Facebook attracted more than twice as many visitors in the month of March as arch-rival MySpace.
- Facebook had an estimated 294.7 million unique visitors in March, 2009 on a worldwide basis, compared to 125.7 million for MySpace. Facebook gained 19 million visitors during the month, while MySpace gained only 2 million. Pageviews for MySpace have seen a drop of 20 percent since January (to 37.9 billion). Facebook has seen growth of 22 percent in pageviews to 87.3 billion (Schonfeld, TechCrunch)
- There are a few things going for MySpace, which caused Owen to take on the task. First, they are still the dominant social network in the US (although not for too much longer). One of Facebook’s problems is their surging amount of international traffic, which is notiously difficult to monetize. Being the top social network in the US is the best market for advertisers (let the internationals go to Facebook, they aren’t worth the bandwidth). Second, MySpace does still dominate the social music scene, and by now they are honing in on more than 10 billion song streams under the new MySpace Music. They are making money with nearly every stream, the one business model Facebook is still envious of MySpace for. Third, MySpace is said to bring in more than double the amount of revenue than Facebook. With MySpace Music included, revenue should be close to $1 billion this year, even in the down economy. Fourth, being the former COO of Facebook, Owen knows the weaknesses of his new rival’s organization. This can play to his advantage.
- His biggest concern as CEO will be retaining his current member base (those already gone to Facebook aren’t coming back, ever). If I were CEO, I’d be looking to capture the youngest possible audience to adopt MySpace before they get their hands on the vastly superior Facebook user experience. There is no way around it, MySpace is the new PC, you must get to them young, or they will go to the dark side (or the bright side?), Facebook (Apple). I would also try to strike deals with hardware manufacturers such as HP, Dell, etc. Just as Yahoo and MSN try to get their homepage/search engines as the default, going through the setup process to boot up your new machine should include an auto MySpace profile (unless of course you already have a profile). This could guarantee an extra couple hundred million potential members per year that may adopt the service or at least try it out. All acts of desperation. If you were CEO, what would you do to save MySpace from the abyss?
Update: Former MySpace chariman Rich Rosenblatt weighs in on what he would do to save the company.
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by Jason Wilk on February 24, 2009
- Every year, good ol’ Steve Ballmer shows up to Wall Street for his annual “Strategic Update” briefing with analysts on February 24. Despite rising anticipation, the Microsoft CEO said Office 14 won’t be shipping in 2009. MS execs more than a few times last year hinted that the latest enterprise software package would be seen in 2009. Customers can expect to see a beta version this summer, but don’t expect the real thing to drop until at least Q1 2010. Despite some issues with bugs at the moment, Windows 7 is still set to release in Q3 of this year. Why they wouldn’t want to release the latest versions of Windows and Office at the same time, I have no idea. Ballmer must have something up his sleeve if he is willing to wait that long to release an ugraded software package. It leaves companies like SalesForce and ZoHo a whole year to perfect their cloud solutions, further eating away at the gian’t market share.
by Jason Wilk on February 5, 2009
- In a depressing earnings call today with the NewsCorp team, Rupert Murdoch outlined the $6.4 billion loss. Murdoch said “the downturn is more severe and likely longer lasting than previously thought.” and “We are implementing rigorous cost-cutting across all operations and reducing head count where appropriate.”
- MySpace earnings fall underneath the Fox Interactive Media section, which also includes products like PhotoBucket. MySpace is thought to bring in the majority of the revenues coming in from FIM. Here is what they had to say on the issue: “Fox Interactive revenues: $226 million revenues. Down due to reduced subs at IGN. Search and advertising were simliar to a year ago. Costs were MySpace Music and international expansion”. The entire division lost $38million.
- I guess Murdoch and Sam Zell (purchased Tribune) were wrong to assume paper media is going to stay strong through the next 5 years. Cuts have already been made across the board, and there is no end in sight to how bad it will get.
Other must read NewsCorp/MySpace Articles:
LEAK: MySpace’s Recession Plan Is To Outsource
Michael Wolff: MySpace Users Are Doomed, Poor
MySpace MyAds Producing 160K A Day
by Jason Wilk on December 22, 2008
- Fox Interactive chief Peter Levinsohn says that 2009 will be an “even rockier economic climate” and the company is taking steps to cut costs at each of their properties. Number one thing to go is part-time/contracted staff as well as FREE lunches. Don’t they know that lunch is where co-workers share ideas the most? Google would go under before taking away their employee cafes.
by Jason Wilk on December 5, 2008
- MySpace, the second largest social network in the world, yet the most profitable, has made a major change in its infrasructure to increase its profitability over Facebook.
- What’s this secret change? They have begun outsourcing jobs including a significant portion of development to India in a move to cut costs during the recession.
- In a recent trip to India, MySpace CTO, Aber Whitcomb and VP of Development, Jim Benedetto, named a new VP of outsourcing.
- His name (confirmed) is Nannu Pahpar and he is to oversee MySpace’s entire overseas coalition to cut costs by managing a team of developers amongst other jobs in India.
- MySpace compared to Facebook, has been notorious for spending less money on hiring top notch developers and have focused more on revenue. The new MySpace Outsource Center is further proof of this and it aims to cut infrastructure costs as much as 1/3.
- It is rumored that MySpace profits for the year will be somewhere around $900 million. This move including their new succesfful MySpace Music venture should easily put them over $1 billion in revenue in 2009.
- This is something that is not possible for Facebook who is consistently hunting for the top developers in the United States with high salaries coming out of places like Google and Microsoft.
- With the current recession, Facebook could be hurting and their recent move to delay the allowing of employees to sell their stock is further proof that they are worried about their valuation and future of making money.
- As for MySpace, the outsourcing is smart, but MySpace is widely recognized as an American based social network and to shift jobs overseas is going to be a highly scrutinized move both inside and outside the company.
- Do you think MySpace should be outsourcing jobs?
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