NewsCorp chairman and CEO Rupert Murdoch has reported that MySpace is taking in close to $25 million dollars in advertising revenue and continues to grow roughly 30% each quarter. This is unexpectedly rapid growth according to Murdoch, who struck up a deal to purchase another modern Internet phenomenon, YouTube, but lost the company to Google. Murdoch predicts that in five years 10 percent of NewCorp's company revenue will come from digital media, mostly thanks to MySpace.
This idea that MySpace is pulling so much money from ad revenue is shocking in a world where everyone is avoiding commercial advertisements on television by using TiVo and even slightly archaic subscription rental services like Netflix. Nobody enjoys the 60-second Advil commercial you have to watch while catching up on last week's episode of Lost on your laptop.
Murdoch makes a good point. YouTube, a video search engine, will drive away its audience if it uses commercial advertising within the video format, which it ultimately will do in order to become a lucrative media venture in the current, if not uninventive, revenue model. YouTube is an experience while MySpace is a community, as Murdoch puts correctly. MySpace uses much more unobtrusive advertising techniques, ones that do not interrupt the booming occurrences of video media on the website. MySpace is a much more integrated digital media model while YouTube can be like bad television created by the unemployed guy who lives next door.
MySpace and YouTube are undeniable elements of our current cultural, economic and technological framework. However, one has more staying power than the other. I vote for MySpace. While it is ultimately in the hands of an old suit, it is created, fed and consumed by the people. It is not just for the high school and college generation anymore; even my post-Baby Boomer/Pre-Generation X mother has a MySpace Music page. YouTube will eventually go down the tubes if the restrictions posed by Viacom are any indication. MySpace has a stake in my space for years to come, as long as it stays democratized.
Mike Shields. "Murdoch: MySpace Monthly Ad Revenue Nears $25 Mil." Media Week. 8 Feb 2007.
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