MySpace Still Seeking the Ad Money

[engine]

When the News Corporation added MySpace to its portfolio nearly three years ago, it expected that if its base of 16 million users kept growing — and each user kept adding friends, sharing photos and swapping flirty messages — the advertising dollars would roll in.

The social networking site has grown — to 118 million worldwide users — and the flirtations have not stopped. But the cash is not coming in as quickly as the company had hoped.

In the fiscal year that ends in two weeks, the News Corporation unit that encompasses MySpace will miss its $1 billion revenue target. When the News Corporation announced the projected shortfall in April, several analysts downgraded the company, sending shares down 5 percent.

MySpace Still Seeking the Ad Money [nytimes.com]

[rogerd]

I'd guess part of that shortfall is assuming that ad metrics from content sites (like news sites, etc.) will be applicable to community/social sites. That's rarely the case. That's not to say you can't have profitable ads, but user behavior tends to be quite different.