MySpace and Facebook are the biggest “social networking” sites on the internet today. However, they each perform different functions, have a different level of usability and command vastly different CPMs (”Cost per Milli” - cost for one thousand ad exposures). MySpace has over “75 million plus users, 15 million daily unique logins, 240,000 new users per day, and nearly 30 billion monthly page views (Techcrunch).” For the week ending July 8, traffic to MySpace accounted for 4.46% of all U.S. internet visits (Yahoo). This makes it the web’s biggest property, surpassing Yahoo and Google. In social networking, MySpace has almost 80% market share, while Facebook falls a distant second with less than 8%.
What is really amazing here is that MySpace, now the web’s largest property, is having amazing difficulty monetizing their users. On average, according to the New Yorker, MySpace only gets $.10 CPM for its page views (see InsideFacebook). In comparison, many blog authors make any where from $1 to $5 CPM for ads on their sites. Does the problem stem from social networking itself, or is MySpace doing a poor job monetizing its users? In a revealing comparison, the New Yorker article says that Facebook, with only one tenth the market share of MySpace, gets up to $4 CPM. That is 40 times the monetization per pageview as MySpace!
What does this mean? If you have used Facebook and MySpace, you know that Facebook has a number of benefits: it is far easier to use, the interface is more beautiful and the feature set is more simple. MySpace is cluttered, its user profiles are ugly and hard to customize, it is full of site errors, it does not remember your login effectively and it is really hard to navigate. Because MySpace takes so many more pageviews to do anything, it gets many times the page view number as Facebook. But even if each MySpace user generated 10 times as many pageviews as Facebook users (which they do not), Facebook would still monetize its users 4 times as well!
For more information on this, see MySpace: Unstoppable Force or Unnecessary Click Factory? by Mike Davidson.
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