It has more traffic than MSN and AOL.com, but will News Corp.’s MySpace become the next Internet powerhouse or will it be last month’s Friendster?
That was the heart of the question for News Corp. interactive chief Ross Levinsohn as he sought to explain how the media conglom will profit from the 35 million people who use the network every month.
While the question can’t be answered with any certainty, Levinsohn sought to reassure Wall Street that there’s a robust and lucrative advertising business behind MySpace, driven by users who are incredibly devoted to the site, visiting on average 650 different pages within the network each month.
Site streams 30 million audio and video streams each month and serves 2 billion ads a day.
“If you are an advertiser seeking the youth of this country, I would say it’s the No. 1 must-buy, because this is where they’re living,” Levinsohn told analysts at the Bank of America Media, Telecommunications and Entertainment Conference in Gotham.
As Fox execs dig deeper into the network and discover more about what they bought for $580 million last summer, they’ve found thousands of users running businesses on MySpace, from music promoters to clothing retailers.
They’ve also found plenty of profiles with porn and some form of hate speech, leading to the removal of 200,000 profiles since News Corp. took over the site last summer.
“A lot of the images don’t reside on MySpace so we don’t have any control over them,” Levinsohn said. “We had a flap with YouTube and shut them off because we weren’t satisfied they weren’t blocking out pornographic video.”
The site has become a lightning rod for criticism by parental groups who allege it provides a neat cover for pornographers and pedophiles.
But analysts seemed more concerned that it may already be losing some of the underground cachet that made it a hit with fickle teens.
Having spent $1.5 billion on Internet acquisitions, Levinsohn said the company has no big new targets in its sights. Rather, smaller “tuck-in” acquisitions are possible among businesses that would add functionality to MySpace and that would grow quickly with an infusion of Internet traffic.