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MySpace Syphoning

A follow up to yesterday's post on how I don't dig Digg or its clones...In that post I mentioned that MySpace was the latest to get into the "social news" act. So why would MySpace do this? Aren't they the most successful social network out there? The envy of every other web site? Are MySpace users really clamoring for a news offering on site? Of course not.

There's only one reason why MySpace would do this - CPM's. It's no secret that user generated content on the net monetizes for shit. The brand issues and the CTR's attributable to an audience more interested in interacting than consuming all make for a pretty low CPM rate on social network sites. So if you are MySpace what do you do? You can either try to create ad packages that get around these issues or create sponsor-able pages on your site that avoid them all together.

MySpace has chosen the latter. Note the power point shots in the article listing ad rates. Now, of course, all of this works only if they are successful in diverting traffic to those pages. The good news for MySpace is that with 38 billion page views a month, if they syphon 1% of their traffic to these pages, they will have the largest viewed news site on the net. The bad news for them is that, even though CPM-wise it will be much better than they have currently, that model still has a long way to go.


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This page contains a single entry from the blog posted on March 14, 2007 2:44 PM.

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