a couple of good articles re Facebook and MySpace from CNN Money:
Facebook CEO visits Seattle, Microsoft schemes
and
As Facebook takes off, MySpace strikes back
From the Facebook article
This year Facebook apparently expects to make $30m profit on $150m revenue [if this number is right it surprises me; the margin is far lower than I would have expected - but then they're presumably investing heavily in infrastructure / development / scaling]
A good quote:
Facebook is the closest thing the world has to a next-generation Internet, one structured not around Web sites but around people. In the Facebook topology, every data source or service is defined by who else is using it.
The company has, in a crude way, solved the critical problem of Internet identity. Each member's profile is tantamount to their personal Web site, which defines who you are, who you know, what you are interested in, and what you are doing now.
Another good quote re Facebook's potential to advertisers:
Facebook may be the best place yet for marketers to experiment with these new techniques. Unlike its bigger rival MySpace, Facebook's individual profile information is intended to represent a real person precisely and accurately. So by investing in Facebook, Microsoft - or Google or another intrepid company
And on Zuckerman v Gates: who is the nicer person?
It may also be worth quite a few hundred million for any company to get into bed with Mark Zuckerberg.
I have gotten to know him a bit in recent months. He is the closest thing to Bill Gates I've seen since the original. Not only does he have natural gifts for programming, leadership, and marketing - traits that served Gates well in Microsoft's first couple decades. He also, like his industry predecessor, seems mostly driven by a conviction that what he is doing will make the world a better place.
The money will come to him, as it did to Gates, not because he seeks it but as a byproduct of finding effective ways to help society move forward using software.
His focus is extraordinary. What's more, he is a nicer person than is Gates.
It would behoove any company to keep him close. His thinking about the importance and role of what he calls the "social graph" - the network of relationships that underlies a social network - is subtle and unselfish.
And from the MySpace article
"Everyone believes all the b.s. press that says MySpace is done for and Facebook has passed us," moans Tom Anderson.
Now there's starting to be real money in the business, as every major consumer advertiser realizes that if you can engage effectively with these newly networked hordes, they become agents of your brand. Last year MySpace was on the lips of every teenager. Now Facebook is growing faster, is usurping the buzz, and thus has Tom Anderson tied into knots.
But defensiveness does not behoove executives who run a division of News Corp, Rupert Murdoch's consummately aggressive company - especially not when that division is the biggest player by far in an explosively expanding business like social networking.
I haven't been on top of the stats and had no idea the numbers were so extreme:
MySpace is the most trafficked website in the U.S.: It registered 45 billion page views in July, according to comScore Media Metrix. Another research firm, Compete.com, calculates that Americans spend about 12% of all their Internet time there.
MySpace v Facebook
Comparing MySpace and Facebook is inevitable because of their dominance in the business, but their differences are profound.
Facebook is intended to be used only to connect you to the people you already know offline; it's a "utility," to use the preferred label of its founder and CEO, Mark Zuckerberg. Its user interface is clean and tidy, and the whole vibe is efficiency and getting things done.
MySpace, on the other hand, is a mishmash of modern media - rich with music and video and comedy. It's like a rock & roll club - chaotic, loud, and packed. Many user profiles are florid and flamboyant, with flashing text and music that starts playing as soon as you arrive.
Myspace has much bigger ad revenue - this year at least
The research firm eMarketer calculates that in 2007, MySpace will sell $525 million worth of advertising, 58% of the social-networking industry's total. (Facebook will sell $125 million - less than a quarter as much.) One huge upcoming opportunity, says DeWolfe, is ad-supported MySpace on mobile phones.
The platform
In late May, Facebook announced it would open up its site and access to its 41 million members - to software created by anyone, from the largest software companies to dorm-room hackers. That made it, Zuckerberg said, a "platform." There are now more than 4,000 new applications on Facebook - and most of the popular ones replicate features already on MySpace.
Any talk about Facebook and its platform is a great way to spoil the mood around the MySpace offices. It's that defensiveness again. "MySpace has always been a platform," DeWolfe insists. "We have an open platform." What he means is that MySpace allows small software applications, known as "widgets," to appear on the site.
The Rupert anecdote
Murdoch visits the hipster-filled headquarters at least once a month, peppering DeWolfe with questions about membership numbers and sign-up rates. In early 2006, DeWolfe enthusiastically told him that MySpace was about to open its first international site, in Britain.
"I was so excited about it," says DeWolfe. "And he's like [mimicking a deep slow Australian voice], 'How many more this year?' and I said, 'Maybe a couple more.' Then he said, 'How about 12?' So we ended up opening 14." )
Anderson has his own Rupert stories: "He called me once and couldn't log in for some reason. I was trying to help him over the phone, saying, 'Type this. Type that. What do you see on your screen?' And he says, 'It says, 'Welcome John.' And I'm like, 'John? Why does it say John?' and he says [affecting his own version of the deep, slightly cranky voice], 'I don't use my real name on MySpace.'"
Are the MySpace dream team about to jump?
So how is it really going, Chris and Tom? "That this has worked out so well and we both hope to be around for a long time is, I think, a really unique story," expounds DeWolfe, as Anderson nods. "We're almost at our two-year anniversary with News Corp. and we're probably going to sign up for another two years, and ..."
Wait a minute. Probably? When pressed, he looks sheepish.
"I don't know," he says, glancing nervously at his PR person. He hesitates. "We may stay with the company." MySpace's top two employees have spent several months negotiating a renewal of their two-year contract, and it's not a sure thing. They didn't own much stock in the parent company that News Corp. acquired, so for all their successes they have not had a big Internet payout.
The two have reportedly pushed for a $50 million, two-year pact and encountered resistance. To be fair, there is every sign they are deeply engaged in their work and are unlikely to leave. DeWolfe's hesitation in our interview could merely be a negotiating tactic.
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