Social netw…, er punishment

Calling all parents of teenage kids. See this from Good Morning Silicon Valley

When Beth, a single mom from Richmond, Va., told her 13-year-old boy to stop playing on his Xbox and do his chores, and the youngster’s ill-advised response was to break the vacuum cleaner, she decided to hit him where it hurts (and her resolve only hardened after she found porn site cookies on his computer). According to Gizmodo, Beth first put the boy’s Xbox up for sale on eBay. Then she password-protected his computer so he couldn’t get online. And finally, in the unkindest cut of all, she posted a Snoopy cartoon on his MySpace page, making him look decidedly uncool. “Apparently I’m the meanest mom in the world, were his words,” she told Gizmodo. “I’m a single mom. I can’t let them walk over me or I might never get up.” Cruel? A bit. Unusual? For now. Effective in reducing recidivism? Time will tell.

Bill Bragg on ‘the Royalty Scam’

Songwriter Bill Bragg was struck by the news that Bebo co-founder Michael Birch has walked away with $600 million after the site was bought by AOL. Bragg has some ideas about what Birch should do with the money:

I heard the news with a particular piquancy, as Mr. Birch has cited me as an influence in Bebo’s attitude toward artists. He got in touch two years ago after I took MySpace to task over its proprietary rights clause. I was concerned that the site was harvesting residual rights from original songs posted there by unsigned musicians. As a result of my complaints, MySpace changed its terms and conditions to state clearly that all rights to material appearing on the site remain with the originator.

A few weeks later, Mr. Birch came to see me at my home. He was hoping to expand his business by hosting music and wanted my advice on how to construct an artist-centered environment where musicians could post original songs without fear of losing control over their work. Following our talks, Mr. Birch told the press that he wanted Bebo to be a site that worked for artists and held their interests first and foremost.

In our discussions, we largely ignored the elephant in the room: the issue of whether he ought to consider paying some kind of royalties to the artists. After all, wasn’t he using their music to draw members — and advertising — to his business? Social-networking sites like Bebo argue that they have no money to distribute — their value is their membership. Well, last week Michael Birch realized the value of his membership. I’m sure he’ll be rewarding those technicians and accountants who helped him achieve this success. Perhaps he should also consider the contribution of his artists.

The musicians who posted their work on are no different from investors in a start-up enterprise. Their investment is the content provided for free while the site has no liquid assets. Now that the business has reaped huge benefits, surely they deserve a dividend…

Social networking peaks

From Creative Capital

I just got a hold of the ComScore numbers for U.S. social networking sites, and it ain’t pretty folks. (See an abridged version of the chart below this post.) After peaking in October of 2007 with 71.9 million users, MySpace, the leading social network, has seen its audience fall back to around 68.9 million unique visitors. December saw no growth over November, though visitors were up 13% from last December.

More alarming are the engagement metrics. Since December 2006, when MySpace engagement peaked at about 234 minutes spent per visitor, time spent on the site has dropped consistently throughout the year. In December, time spent per visitor saw its biggest month-to-month drop, of about 8.5%, to 179 minutes per visitor per month, down from 196 minutes in November. That equates to a 24% year-over-year drop.

But the pain is not just a MySpace problem. It seems to be an industry-wide issue. The total audience of U.S. social networks seems to be stuck at a low-to-mid-single digit growth rate, while the engagment metrics are falling for just about everyone. Time spent on has been sliced in half over the last four months, while Friendster’s time spent has plummeted nearly 75% in the same time period. Overall, minutes spent per site fell 5% in December 2007 compared to the year-ago period….

More in that vein here.

Social class and social networking

Ah — just as I thought. BBC News reports that:

Fans of MySpace and Facebook are divided by much more than which music they like, suggests a study.

A six-month research project has revealed a sharp division along class lines among the American teenagers flocking to the social network sites.

The research suggests those using Facebook come from wealthier homes and are more likely to attend college.

By contrast, MySpace users tend to get a job after finishing high school rather than continue their education…

Facebook enters phase of exponential growth

Watch out, MySpace. Facebook’s on the rise. Interesting Yahoo! News report about Facebook opening up to third-party developers as well as non-graduates.

After the site opened up registration to non-college students last September, it evolved into a major social networking destination to rival, owned by Rupert Murdoch’s media conglomerate News Corp.

Facebook now has more than 24 million users who have logged on in the past 30 days. Venture capital firms including Accel Partners have contributed more than $35 million.

Critics say Facebook — which is getting more than 100,000 new registrations per day — can’t maintain its scorching growth rate. Others worry that [founder Mark] Zuckerberg and the company’s other 20-something technophiles lack the experience and credibility to turn the site into a profitable, publicly traded company.

On Thursday in San Francisco, Zuckerberg — who sported a fleece jacket, baggy jeans and flip-flops — seemed well aware of the challenges ahead. Technical gaffes dogged his nearly hour-long speech, and he broke out in a visible sweat.

“We’re the sixth most trafficked site in the U.S. and we can’t seem to get our act together,” Zuckerberg joked as he fumbled to synchronize his presentation slides, which were in disarray.

After laughs from the crowd, he regained his composure and added, “We recently passed eBay in traffic and we’re working on passing Google, too.”

Free lunches still elusive on MySpace

Nice comment by Don Dodge…

MySpace has blocked Photobucket content again. Robert Scoble reminds us when you host your content on free services nasty crap can happen. TechMeme is flooded with blogs angrily protesting MySpace’s actions. The lesson is this; Free services always come with strings attached, limitations, service outages, advertising, and rules that can change at any time without notice.

Consumers sometimes forget the bargain they made in exchange for the free services. Sometimes it means your personal information can be sold or marketed. Other times it means your content is not really yours anymore. Sometimes it means you get to pay for additional services once you are hooked. Or maybe that the rules change over time and the service is unreliable. Most times things work out OK and consumers don’t complain too much.

Consumers will put up with hassles and uncertainty in exchange for a “free” service. Businesses will not. Business customers require solid, reliable systems and they are willing to pay for them.

Both markets, consumer and business, are important and potentially profitable. However, the economics and expectations are different for consumers. As an example, Microsoft has 260 million Hotmail consumer users and over 500 million Outlook business users. The terms of service and feature sets are different and so are the business models.

MySpace, YouTube, FaceBook, and other Web 2.0 free services get lots of attention. They are held up as examples of innovation and the new way of doing things. I agree they are fun services but innovative? Depends on your perspective…

Nick Carr gleefully pitches in:

It’s worth remembering that the business model of Web 2.0 social networks is the sharecropping model. After the Civil War, when the original sharecropping system took hold in the American south, the plantation owners made money in two ways. They leased land to the sharecroppers, and they also leased them their tools. It’s no different this time. The payments for land (Web pages) and tools (video widgets et al.) don’t come directly, through exchanges of cash, but rather indirectly, through the sale of advertisements. But the idea is the same. If there’s a widget that can accommodate advertising, that tool will be supplied by the plantation owner, not by some interloping varmint. Whine all you want, but that’s the way it’s going to be.

When is a ‘friend’ not a friend?

(Answer: when he’s Rupert Murdoch.) This morning’s Observer column

Tom Anderson, the founder of MySpace, had – as of 9.42am on Friday 30 March – 167,144,385 ‘friends’. This is not because he is exceedingly sociable, but because anyone who signs up on MySpace automatically becomes one of Tom’s friends. By the time you read this, he will have another 500,000. (MySpace is adding 250,000 users a day.)

The MySpace concept of a friend may seem contrived, but is much closer to what a businessperson would describe as a ‘contact’. This may be why the corporate world is gazing anxiously at the social networking phenomenon and wondering if it has anything to offer. Two studies – by Forrester Research, a market research firm, and McKinsey, a consultancy – offer conflicting views…

Only approved MySpace invaders allowed in FoxSpace

Well, well. The NYT is reporting that you can put what you like on MySpace — so long as it isn’t designed to bring you revenue.

Some users of MySpace feel as if their space is being invaded.

MySpace, the Web’s largest social network, has gradually been imposing limits on the software tools that users can embed in their pages, like music and video players that also deliver advertising or enable transactions.

At stake is the ability of MySpace, which is owned by the News Corporation, to ensure that it alone can commercially capitalize on its 90 million visitors each month.

But to some formerly enthusiastic MySpace users, the new restrictions hamper their abilities to design their pages and promote new projects.

“The reason why I am so bummed out about MySpace now is because recently they have been cutting down our freedom and taking away our rights slowly,” wrote Tila Tequila, a singer who is one of MySpace’s most popular and visible users, in a blog posting over the weekend. “MySpace will now only allow you to use ‘MySpace’ things.”

Ms. Tequila, born Tila Nguyen, has attracted attention by linking to more than 1.7 million friends on her MySpace page. To promote her first album, she recently added to her MySpace page a new music player and music store, called the Hoooka, created by Indie911, a Los Angeles-based start-up company.

Users listened to her music and played the accompanying videos 20,000 times over the weekend. But the Hoooka disappeared on Sunday after a MySpace founder, Tom Anderson, personally contacted Ms. Tequila to object, according to someone with direct knowledge of the dispute. She then vented her thoughts on her personal blog.

MySpace says that it will block these pieces of third-party software — also called widgets — when they lend themselves to violations of its terms of service, like the spread of pornography or copyrighted material. But it also objects to widgets that enable users to sell items or advertise without authorization, or without entering into a direct partnership with the company.

A MySpace spokeswoman said yesterday that the service did not remove anything from Ms. Tequila’s page. “A MySpace representative contacted her and told her that she had violated our terms of service in regards to commercial activity,” the spokeswoman said. “She removed the material herself, after realizing it was not appropriate for MySpace.”

Ms. Tequila and her representatives would not comment.

But Justin Goldberg, chief executive of Indie911, said MySpace’s actions undercut the notion that the social networks’ users have complete creative freedom. “We find it incredibly ironic and frustrating that a company that has built its assets on the back of its users is turning around and telling people they can’t do anything that violates terms of service,” he said.

“Why shouldn’t they call it FoxSpace? Or RupertSpace?” Mr. Goldberg said, referring to the News Corporation’s chief, Rupert Murdoch.

TechBubble 2.0

This morning’s Observer column

Colossally inflated valuations are an infallible indicator of a bubble. In the late 1990s, dotcom start-ups with 50 employees and zero profits were briefly valued at more than the market cap of Fortune 500 companies. In 2005, Rupert Murdoch paid $649m for MySpace and eBay paid $2.6bn for Skype, a VoIP [internet telephony] company. Last year, Google forked out $1.65bn for YouTube. Such valuations provide terrific incentives for ambitious geeks because the new web services require less upfront investment than the original dotcoms. What is YouTube, after all, other than some smart software for converting every uploaded video clip into a Flash movie, plus server capacity and bandwidth? Skype adds 150,000 subscribers a day and buys almost no hardware because it uses its subscribers’ computers to do the heavy lifting…