MySpace Up For Grabs
News Corp. is in discussions with Google Inc., Microsoft Corp. and Yahoo Inc. about replacing MySpace’s crucial search-advertising partnership with Google, which expires next month, according to people familiar with the matter. Under the existing deal, Google agreed to make up to $900 million in guaranteed payments for the right to sell small ads as users surf and tap out searches on News Corp.’s My Space.com and on a handful of smaller News Corp. websites. But recently, MySpace has fallen far short of Web traffic and other milestones laid out in the Google contract, which expires at the end of August.
In recent weeks, News Corp. has been discussing new, narrower advertising deals with Google and other companies, said the people familiar with the matter. People close to News Corp. said any new agreement will be for significantly less money. That would be a further financial challenge for MySpace, which has seen ad revenue slip. Google and Yahoo declined to comment. Google in 2006 beat out Microsoft and Yahoo for the ad pact, which was regarded at the time as justifying News Corp.’s purchase of MySpace’s parent company for $650 million. News Corp. also owns The Wall Street Journal. The deal is winding down at a turbulent point. MySpace has seen turnover among several top-level executives, including Co-President Jason Hirschhorn last month.
The website also is in the midst of a remodeling to stand apart from Facebook Inc., which has surpassed MySpace as the dominant online place for people to swap stories, comments and photos with friends and acquaintances. Reviving MySpace is a high-level project for News Corp., which dispatched Chief Digital Officer Jon Miller to oversee the effort. MySpace also is a test of whether Internet properties can rebuild buzz and revenue growth once they have ebbed. That’s also the task facing AOL Inc. and Yahoo, both of which are in the middle of turnaround efforts. News Corp. executives say they believe privacy and other concerns about Facebook leave an opening for MySpace to attract new users and business partners, though they also say MySpace doesn’t expect or need to be as big as Facebook. Instead, MySpace says it is focused on Web surfers younger than 35, and is offering them a place to find new music, videos, games and other diversions, and to locate new people with similar interests.
MySpace has also touted its initiatives to allow users to easily keep secret their personal information such as photos, birth date and hobbies, a counter to recent privacy worries about Facebook. MySpace’s new strategy in addition includes ways for musicians, comedians, authors and fashion designers to gather an audience and tools to measure who and where their fans are. A band, for instance, could use MySpace to share music with fans and get feedback, as well as adjust their touring schedule to add concerts in Texas, for example, if the musicians see their MySpace fan base is heavily from that state.
MySpace also plans in coming months to roll out new applications for cellphones and to overhaul its site, possibly including a new logo. Aaron Shapiro, a partner at online-marketing firm Huge, said MySpace can carve out a niche alongside Facebook and Twitter, but he cautioned that MySpace still has a long way to go to make the website easier to use and to incorporate slicker design and technology. “They’ve been frozen in time for four years in terms of their degree of innovation,” he said. More than a year into its shift, MySpace attracted 109 million unique world-wide visitors in May, down nearly 13% from the same month last year, according to comScore Inc. Facebook had more than 548 million global users, up 74%. MySpace executives say they are focusing on increasing the percentage of the U.S. population of 13- to 34-year-olds who visit the site each month to 75% from 50%. “My goal is to saturate that specific audience,” said MySpace President Mike Jones. Mr. Jones became the top MySpace executive after Mr. Hirschhorn stepped down in June, which in turn came just months after Chief Executive Owen Van Natta was pushed out. MySpace also has cut about 30% of its work force, and News Corp. took a $450 million charge last year to write down the value of MySpace and other digital businesses.
Read More: WSJ.com
At Yahoo, Using Searches to Steer News Coverage
Welcome to the era of the algorithm as editor. For as long as hot lead has been used to make metal type, the model for generating news has been top-down: editors determined what information was important and then shared it with the masses. But with the advent of technology that allows media companies to identify what kind of content readers want, that model is becoming inverted. The latest and perhaps broadest effort yet in democratizing the news is under way at Yahoo, which on Tuesday will introduce a news blog that will rely on search queries to help guide its reporting and writing on national affairs, politics and the media. Search-generated content has been growing on the Internet, linked to the success of companies like Associated Content, which Yahoo recently bought, and Demand Media, which has used freelance writers to create an online library of more than a million instructional articles.
Read More: NYTimes.com
Google’s Display Advertising Plans Include Gmail and YouTube
For a company that has made a big business of indexing third-party websites, a substantial part of Google’s display success hinges on its ability to milk YouTube and its other owned and operated properties such as Gmail and Google Finance. In fact, those areas were two of the three big priorities outlined by VP Neal Mohan at a press briefing last week where a parade of Google executives described the company’s plans to expand its ad business beyond search keywords. “Display is truly at a tipping point,” Mr. Mohan said. “We think it can be substantially larger than the $20 billion it is today, whether [it's] $40 billion, $60 billion, or $80 billion, but there are a lot of challenges that remain.” Mr. Mohan said there were gross inefficiencies to the display ad buying process. As an example, he said it takes 30 days or more to get a creative advertising unit up and running. “That process should be much more streamlined,” he said.
Read More: AdAge
