DigitalMediaTrends.com

Battle for Address Book Ownership

There is a battle brewing for ownership of your address book. It all started when MySpace, Facebook and LinkedIn started asking users if they wanted to port their contact lists, giving them instant friends on their social networking profiles. The network effect [created by syncing contacts] is a prime driver of the Internet and is critical to the success of burgeoning social networks. More ..

MySpace and Facebook: Not Competitors?

For all the talk about MySpace vs. Facebook, there are vast differences between social networking's top two; they might even be able to coexist peacefully. Content-wise, MySpace and Facebook couldn't be more different. There's a strong hint of old media to the former's model for expansion, while Facebook is about the development of new software to help its users interact with one another. For example, News Corp. content has become a big part of MySpace's stickiness strategy. Clips from Fox shows like "The Simpsons" and "24" have helped it become the second most-popular video site on the Web. MySpace continues to be a driving force in music; thousands of artists have profiles and the company even has its own record label. Expect MySpace to soon move into TV and film and production. Over at Facebook, the focus seems to be on software. The 40 million-strong social network--which represents less than half of MySpace's registered total--has never licensed content and probably never will. Even so, MySpace execs have a Facebook obsession, while Facebook CEO Mark Zuckerberg says, "I've never really considered us competitors." More ...

Facebook Confirms New Ad Plan

A new advertising system on Facebook gives marketers access to an unprecedented amount of information that its users reveal about themselves. The idea is to ultimately devise a system that predicts what products and services users might be interested in before they know it. Unnamed sources say the new behavior targeting plan, set to be unveiled this fall, is the company's top priority moving forward. Facebook declined to discuss specifics. The same sources said the social networking giant is trying to achieve what Google did with AdWords, allowing advertisers to buy groups of people with similar interests using enhanced, targeted technology. Right now, advertisers can only target by age, gender and location; the new technology would add stated user interests, such as music, activities, sports, etc. Instead of selling simple banner ads by category, marketing messages will appear in user, group and company news feeds. Facebook advertisers can already create their own pages and send out messages via news feeds in a separate, but vaguely described three-month marketing campaign. The new program is about pushing relevant marketing items onto users' pages. The company thinks the new initiative will be a less labor-intensive way to take advantage of the personal data people reveal on the site. More ...

Social Networks As CRM Tool

Facebook and MySpace are starting to make bank on online advertising, but a recent Forrester study shows that traditional online ad formats aren't really playing well for advertisers. The result is a growing concern that social networking isn't a marketing boon. Using it as a customer-relationship-management tool could be one answer; former Jay Walter Thompson CEO Chris Jones said MySpace is at a crossroads. It doesn't want others using its audience for marketing purposes without getting a piece of the action. Jones is now an adviser to widget-creator FreeWebs. Indeed, some marketers, like Carnival Cruises, have developed internal social networks to let customers review their products and talk to the company directly. That's part of Facebook's expansion plans; get companies to develop continuing relationships with consumers. More ...

Facebook: Yours For $10 Billion

Here's a piece of big news that just about everyone missed: Facebook is on the block, and they want just $10 billion. Any takers? Google, Microsoft (it's too expensive now for Yahoo)? The hint came from a report in The Deal last week where PayPal co-founder and Facebook director/major investor ($500K) Peter Thiel discussed the possibility of a merger. Thiel basically said that neither an acquisition or an IPO were in the immediate cards: "If we have a fully developed revenue model, it would be much easier to value [Facebook ... but we're very, very far from that point." However, at the end of the report he threw out the following: "If we got an offer from someone for $10 billion, we probably would listen to them. I don't think we're going to get that offer, and we're not going to solicit it." More ...

Facebook Acquires Parakey

Social networking sensation Facebook on Thursday acquired a Web startup named Parakey, a platform its creators say "bridges the gap between information on the Web and the desktop." There are almost no details on the company's Web site--as the product has yet to launch--but the idea behind Parakey (or so it seems) is to create a closed network or intranet that links desktop and Web information. "Computers are frustrating. Creating documents, finding files, sharing information -- why do everyday things still seem so tedious and counterintuitive?" the company's Web site says. How does this fit in with Facebook? Part of the social networking giant's appeal is the control it gives users over who sees what personal details. Parakey could enhance the networking capabilities of business users by allowing certain users, like fellow employees or clients, access to certain data sets-all in a customizable manner. It could also be used to exchange closed-door information between family and friends. More ...

Facebook Proves Both Profitable And Desirable

With the posh social network again the focus of acquisition rumors, a key investor pegs its 2007 revenues at $100 million. More ...

Microsoft Offering $6 Billion For Facebook?

Unnamed sources on Tuesday told Internet Outsider Henry Blodgett that Microsoft is eyeing a $6 billion takeover of Facebook--an unconfirmed rumor the former Internet industry analyst says makes sense. He writes: "Steve Ballmer, desperate and furious, sick of sucking wind in the Internet game, sick of losing every Internet in-play company and much of the future to You Know Who ... should ... scoop up "the hottest company on earth." But $6 billion? Surely Michael Zuckerberg and co. have bigger plans than to sell out for $6 billion, which Blodgett notes is about 1/25 of Google's valuation. Battelle doesn't see the logic of the move, since the company doesn't need anyone else right now. That said, Battelle notes that $6 billion, at 200 times expected earnings, is quite a valuation, when the company is on pace to generate just $30 million this year. So maybe, if Facebook is approaching its peak demand -- usage and innovation are great, but where's the money coming from? -- this might be the right time to sell. What sets Facebook apart from other social networks? There's no easy answer. More ...

Social Networks Adversely Affect U.K. Ad Growth

The news from the U.K. today shows that MySpace -- in about 12 months -- has easily catapulted to the top of the social networking pile, attracting more than 10 million visitors in the U.K. last month, more than double second-place Bebo, with 3.96 million uniques, and Facebook, 3.2 million. However, in a separate study, GroupM media forecasters said that the surging popularity of social networks in Britain is proving to be a drain on the growth of Web advertising. Why? Two reasons: one, consumers are spending more time social networking at the expense of professional news and entertainment publishers; two, the fact that users create the content is a detractor to big-spending global advertisers, which don't want their brands placed on content with no corporate control. Does the same hold true for the U.S.? You bet, which underscores the need for marketers and social networks to figure out the advertising conundrum. More ...

Google to Aggregate Social Networks

Given the resurgence of Facebook and social networking, you may be wondering where Google stands on social media. YouTube is really the only social media site in the Web giant's vast catalog of services, but it's hardly a social network. But Google is creating a social networking technology -- and it heavily leverages the company's industry-leading search technology. The prototype, called "Socialstream," is being developed by Carnegie Mellon University's Human Computer Interaction Institute, and has been billed as an aggregator service of social networks that interacts with and draws data from users' existing social networks. "A service model allows many social networks to be linked together, letting them share both content and the nature of the relationships of the people who use them," the Socialstream Web site reads. How would social networks like MySpace feel about this? Not good, probably, but that hasn't stopped Google. As ever, the company believes that MySpace, Facebook, LinkedIn and others would willingly partner with such a "useful" service. It's classic Google to "reinvent and rethink" established services and worry about the consequences later. More ...