| SAN FRANCISCO
SAN FRANCISCO News Corp's MySpace, the world's
largest online social network, said on Wednesday it will allow
outside developers further access to its service to counter the
growth of smaller rival Facebook.
News Corp chairman Rupert Murdoch joined MySpace chief
executive Chris DeWolfe to make the announcement before Silicon
Valley's Internet elite and answer questions about the media
conglomerate's digital future.
"We are opening our platform in the next couple of months,"
DeWolfe said, confirming months of speculation that MySpace
would follow in the footsteps of Facebook, which emerged as a
serious competitor after allowing software developers to create
applications for its users.
At the same time Murdoch signalled lower expectations for
MySpace revenue in the company's 2008 fiscal year ending in
June, suggesting it may not reach a previous forecast of over
$800 million (392 million pounds).
"I might say $750 (million) but it's at least 30 times what
it was the day we bought it two years ago," Murdoch said at the
Web 2.0 Summit in San Francisco. "If we keep that trajectory
going like that we'll be very happy."
Murdoch's acquisition of MySpace for $580 million in 2005
crowned him as the smartest media executive at the time, once
rivals realized the potential of its growing base of users for
promotions and advertising.
But privately-held Facebook has surged to a strong second
place in the social network world since it opened its site a
year ago beyond an original base of college students and
started allowing in May independent software makers to build
applications for users and profit from it.
"There's been so much excitement, energy and growth on the
part of Facebook," said Forrester analyst Charlene Li. "There's
a lot of pressure on MySpace to capture that energy."
While MySpace remains the leader with nearly 110 million
users, Facebook's rapid growth to over 47 million members has
made it a new media darling, with media reports pegging its
potential value to investors as high as $15 billion.
"I would say we're different (than Facebook) and in spite
of all the hype we seem to be growing faster," Murdoch said.
Asked what he thought of such a valuation, Murdoch added:
"What it really does is it tells you that News Corp is totally
MYSPACE IS THEIR SPACE
For four years MySpace has allowed users to embed features
from other Web sites by pasting bits of code on their MySpace
pages. But Facebook's open call to developers has already
attracted 6,000 independent applications to its site.
"YouTube, for one, basically generated all their early
traffic on MySpace," DeWolfe said of the company's traditional
willingness to let other Web companies build businesses on
MySpace. YouTube is the online video unit of Google Inc.
DeWolfe said he was seeking to create a far more lucrative
environment for outside developers on MySpace than currently
exists on Facebook, where so far advertising opportunities for
independent application developers are limited.
"The idea will be to allow outside developers to tightly
integrate their applications into MySpace," DeWolfe told
Reuters following his on-stage appearance.
Software programmers will be able to control key aspects of
how features like photos or user authentication work, allowing
them to build more complex Web services than the restrictive
approach MySpace has employed to date with outsiders.
Importantly, the company plans to give developers control
over advertising that runs on the Web pages they create to host
new services on MySpace. "There is going to be paid revenue
opportunities for all the developers," DeWolfe said.
MySpace also plans to take steps to protect its users from
potential security problems or overload created by a sudden
flood of new applications. It is setting up a "sandbox" version
of the site for 2 million users who elect to get early access
to new applications while they are still in test mode.
DeWolfe also said he and MySpace co-founder Tom Anderson
have signed up for an additional two-year contract. He did not
disclose financial terms.
MySpace had already taken steps to bulk up its presence and
showcase its technology expertise, opening an office in San
Francisco this week with about 50 employees and plans to expand
its team to about 200 people within the next year.