Team lakers Tiffany lau David mangold Emily nguyen Xiang zhang MySpace Team lakers Tiffany lau David mangold Emily nguyen Xiang zhang

MySpace To-Date Background Features Acquired by News Corp. in 2005 Same design 2005-2007 Advertising partnership with Google in 2006 Protecting Minor Members in 2006 External Content Issues (2006-2007) Acquires Photobucket (2007) Features Profile Control Entity Profile Bands No network/Digital Representation Blogs (2005) Mobile (2006) Online Video (2006) MySpace Chat (2007)

Facebook To-Date Background Features College  High School  Open Turns down multiple acquisition offers Viacom Yahoo! Privacy issues News Feed Beacon Microsoft purchases minority stake (2007) Features Limited profile control Information control (Network) News Feed (2006) Beacon (2007)

Market Trends – Audience for Online Services MySpace is the clear market leader with more than 3x the user base of the next closest competitor.

Market Trends - Monthly Unique Visitors Facebook is showing significant growth (approx double in 7 months) Youtube is also showing significant growth MySpace shows greater seasonal change than growth, growth is stagnant

Market Trends - Pages Viewed per Visit MySpace’s pages viewed has been nose-diving for the last 7 months. We need to give the users ways to explore and reasons to stay.

Market Trends – Internet Content Spending Expected 78% growth in total internet content spending over the next 3 years, almost all of which is driven by online games and digital music

Market Trends - Summary Myspace is the clear market leader (3.75x the user base of the next closest competitor) Myspace’s growth is stagnating while Facebook’s is exploding Myspace’s page views per visit are nose-diving (need to give users ways to explore and reasons to stay) Expected 78% growth in internet content spending over next 3 years, almost all of which is driven by online gaming and digital music

Competitive Environment – Customer Segmentation and Product Differentiation Myspace Customer Segments Latino/Hispanic teens, immigrant teens, ‘burnouts,’ ‘alternative kids,’ . . . and other kids who didn’t play into the dominant high school popularity paradigm. Bands and other creative and artistic users Only ~35% of users in household with annual income over $75,000 Differentiating Features Full Profile Control Loose Privacy Settings Entity Profiles Facebook Customer Segments “the goodie two shoes, jocks, or other ‘good’ kids are now going to Facebook. These kids tend to come from families who emphasize education and going to college.” General middle-upper class college and high school students 50% of users in household with annual income over $75,000 Differentiating Features Limited Profile Control Only friends can view personal info Affinity Groups Facebook: “the goodie two shoes, jocks, or other ‘good’ kids are now going to Facebook. These kids tend to come from families who emphasize education and going to college.” Myspace: Latino/Hispanic teens, immigrant teens, ‘burnouts,’ ‘alternative kids,’ . . . and other kids who didn’t play into the dominant high school popularity paradigm.

A Crossroads Myspace must decide how to respond to Facebook and is considering 2 options: Joining Google’s OpenSocial Creating it’s own developer program

Join OpenSocial Match Facebook functionality without major investment Pros Cons Match Facebook functionality without major investment User data would be available to Google through Google’s own sites “Open Source”: Applications would work for competitors without much modification

Launch Own Developer Program Pros Cons Ability to request payments to use its platform Could create own aesthetics Differentiation Costly Not sure what OpenSocial would look like Uncertainty regarding launch date

Summary of Issues Myspace hasn’t changed it’s interface since 2005, it needs a new look to correspond with it’s new direction Myspace is popular with alternative, creative users who value freedom and self-expression, it needs to focus on this core group Myspace has been limiting external content for years, much to the dismay of it’s users, it needs to allow as much freedom of expression as possible and work through the legal issues Myspace’s core user base cares about creating a new digital persona and connecting with others through similar interests, Myspace needs to focus on making that easier Myspace has been limiting media ability and it needs to heavily expand its media capabilities to capture the emerging digital music and online gaming markets

Recommendation Launch it’s own developer platform Myspace needs to It may be a large initial cost, but the social networking market is all about market size and market share and the cost of losing users because we can’t compete isn’t worth it Myspace needs to 1) Reaffirm its Brand 2) Segment and Specialize 3) Expand into Media

Recommendation (cont’d) Reaffirm its Brand Redesign the site to re-imagine the brand Segment and Specialize (launch it’s own developer platform) Myspace users like freedom of expression (think about profile control), this allows them to interact and post content the way they want, keep user data and differentiate for Myspace It would make it easier for users to integrate external content, which is necessary for Myspace to continue to provide for it’s creative and artistic user base It would further allow its users to connect with each other in new ways through Myspace It would allow users to create more ways to integrate different types of media into Myspace and help capture emerging markets (Music, Gaming, Photos, Video…) Expand into Media Expand integration of music for bands, it is important emerging market and Myspace is the market leader in social networking for music Create a News Feed that specifically caters to Entity Profiles and interests so fans can stay up-to-date with their favorite artists and artists Look for strategic partnerships with the music and entertainment industry