Is it no longer “your space”? Are social networks in trouble?
EDITORIAL
Myspace CEO Chris Dewolfe has stepped down from his position. Why would the CEO of a major social networking online community leave? Social networks have been the backbone of pop culture for the past couple of years rising to prominence because they help you find long lost friends, family members or even a date.
MySpace had been the leader of the pack. They even gained the attention of Fox Media Interactive so much that the media outlet bought the online business. The larger they got however, the more they began to depend on advertising to stay afloat. This is normally not a big deal, unless the ads that you are showing are annoying to your primary audience. The other question, which remains to be unanswered, is how profitable MySpace has actually been.
On top of all of this, the site has gained negative press for all of the individuals using the site to prey on other individuals and children. MySpace has gone from a viable business and a pop culture icon to a punch line in a short amount of time. When jokes start to begin with, “so I was on MySpace…, ” it probably is not a good sign for your business.
MySpace created, so it seemed, the new model for making money online. Facebook took the concept and ran with it and now they have surpassed MySpace and Twitter is on the rise also. Is Dewolfe leaving a sign of things to come though? Is the age of the social network over? Facebook and Twitter better pay attention to MySpace in the upcoming months.
Although Facebook has secured an investment from Microsoft, will it be enough to make them financially solvent. Venture Capital dollars, which Twitter depends on primarily, eventually run out and the company must eventually return the investment. Is the MySpace, Facebook, Twitter model of social networking going to last?
To remain relevant, they are going to have to do what every business does…diversify. What that diversification includes remains to be seen. They must find ways to create consistent profitability or every one will lose confidence in the business model, including the major investors. If this occurs, social networks will become the “pet rock” of the internet.
This is a very interesting article. Recently the social networking boom has provided companies with the opportunity to publicize to a wide audience all from a single site. With giants like Myspace.com and Facebook.com leading the pack, there were numerous spin off of fan clubs, alternative, and entertainment sites following the suit of social networking leaders by incorporating into their web design new features such as memberships and profiles. Just a few years ago it was the primary promotional tool for many independent artists. What seems to have happened is that although the membership and audience continued to expand, the return on investment for most of its corporate sponsorship were yet to see the benefits. Thereby posing the question, does a wide audience necessarily translate into commercial success? Just ask the big entertainment conglomerates that are thinking about not renewing advertising contracts and partnerships. Social networking definitely has peaked in some aspects, the thing is that when catering to a potential consumer base as wide as some of these social networking there is one thing that businesses must be assure of, and that is are you reaching your ideal consumer. The generation of individuals 30 and under create fads quickly and then move on to something else.. If Myspace and Facebook are to remain atop of their game, they better start thinking about tapping into the baby boomer generation that are coming off of their manufacturing jobs, into the information age, where soon even the elderly will be online connecting with classmates.. If it’s one thing for sure, we best to enjoy this social networking boom while it last, because there a whole new generation ready to innovate the next best thing as we speak…
Peace
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