Michael Wolff's Calm, Reasoned Analysis Of MySpace, And The "Cretins" That Flock To It

Posted by: Jon Fine on December 1, 2008

Part of writing my latest column required interviewing Michael Wolff, a friend and the author of the new Rupert Murdoch bio “The Man Who Owns The News.” After some negotiation, the interview took the form of a lengthy discussion-cum-argument. Sort of like what we do sometimes for this outfit, only with dinner and at much greater length.

Portions of what we discussed were entertaining enough—at least to me—to warrant posting here. In excerpt below, which is lightly edited for clarity and profanity, Michael and I argue over the value and prospects of MySpace.

Michael Wolff: MySpace. They [meaning News Corp] know they have a huge problem. They’re quaking in their boots about MySpace. It always was a little rustling when I was there, there was this rustling—

Jon Fine: What do you identify as the problem?

MW: Facebook.

JF: OK. But Facebook is still smaller in America, and—

MW: Absolutely. But you know the rhythms of the Internet business, which I think are still, at this point, immutable. Something else comes along—a better technology, a better flavor of the month—and you, the former, are downgraded. Possibly to the point of being downgraded out of existence.

JF: I think there you are falling into a fairly common thing. Facebook—it’s a better experience than MySpace. But the traffic on MySpace and the people on it...

MW: All of the growth now in MySpace is international.

JF: Sure. Because once you get to 75 million in the US, where are you gonna go?

MW: I know they recognize this: “We got to monetize this thing. We got to get this thing off the books.”

JF: Your magazine or my magazine would give both ears to get to $750 million in revenue [which is, very roughly, what MySpace’s revenues are]. The funny thing about MySpace . . .

MW: What they understand, is their $25 billion to $30 billion valuation.—

JF: But that’s [expletive]. We both know that’s [expletive].

MW: It doesn’t make any difference. That’s gonna go down. What they are looking at is the distinct possibility that it can go down to nothing.

JF: How do you find that plausible? It’s not even a utility like—-the anti-Google argument is this: If someone builds a better search engine tomorrow, I have zero switching costs. If I am on MySpace, I have 500 friends. I use it to communicate with people. You can’t just move. It’s a pain in the ass. All your stuff is there.

MW: But that’s exactly what they said about AOL.

JF: You did not develop that relationship with AOL.

MW: You did. You exactly did.

JF: How?

MW: Your email was there, because your friends were there. I mean, AOL operated actually as the community of its day. There were all of those—

JF: But besides the email and, OK, the—

MW: There were the infinite number of chat rooms. Layer upon layer upon layer of sex chat rooms.

JF: Of course. And I give you credit for having pointed to that as the secret driver of its success. But, all you need is a different chat room. You don’t have pictures up [on AOL]. You don’t have your history up there. You don’t have—

MW: It doesn’t matter. What they saw at the time was that [users] were absolutely wedded to AOL. That was Time Warner’s bet on that.

JF: AOL was monodimensional in a way that MySpace is not. I don’t think that’s particularly debatable.

MW: I don’t think that’s true. I think it is--if you’re on MySpace now, you’re a [expletive] cretin. And you’re not only a [expletive] cretin, but you’re poor. Nobody who has beyond an 8th grade level of education is on MySpace. It is for backwards people.

JF: [unsuccessfully stifling laughter] I don’t mean to get all Murdoch’s-kids on you [an obscure reference to an earlier part of the conversation], but if you are in a band, you are on MySpace. You have to be on MySpace. That’s a powerful driver. And second of all-- if I am to accept your reasoning, even though I don’t--as the success of [News Corp’s British tabloid] The Sun will tell you, there are lot of cretins out there and you can make a lot of money off cretins. By appealing to their essential--

MW: No! That is the difference. And that is one of the interesting points of Murdoch. He wants to make money off of what he rightly saw as a rising lower class. He came to this country and he sees, that’s just not really true. No one really identifies with being lower class [in the US]. As soon as it comes to you—‘I am lower class’--you run, and you have to rehabilitate all of your aspirational identifiers.

JF: [mentally substituting 'working' for 'lower,' and flashing on this and this, for starters] Whatever. Evidently I’m not gonna convince you, even though you’re wrong. Anyway, MySpace is a sideshow. You barely mention it in the book. Which I kind of like.

Reader Comments

Don Resnitch

December 2, 2008 12:25 AM

What a mess. I am sorry I read this - it's such nonsense. In the economic climate - green is king - let's chat when FB starts monetizing those eyes.

L Martin Johnson Pratt

December 2, 2008 2:26 AM

this is why OLD MEDIA is consistently losing money. So much for basic research LOL Old media guard doesn't get it nor do they even use Pew Research on Internet www.pewinternet.org or www.nielsen-online.com/ Come on Business Week why even print this garbage?? But since you did here is the factual data:

"Wolff goes into detail on exactly why he thinks MySpace will go the way of AOL. He also makes some blatantly incorrect statements, such as “All of the growth now in MySpace is international,” which is incorrect. In the last year MySpace has grown about 10% in the U.S., adding 7.5 million monthly unique users to a total of 76.4 million. Non-U.S. users have grown from 45 million to 54 million, a 17% increase. (source: Comscore)

And those comments about MySpace users being poor and uneducated aren’t entirely correct either. Of MySpace’s U.S. users, 52% make more than $60,000 per year, which is far from poor. 23% make more than $100,000 per year. Just 11.6% make less than $25k/year.

Facebook’s numbers are 65% and 33%, respectively, which is more impressive. But MySpace has 30 million more U.S. users than Facebook (76 million v. 46 million), so MySpace’s aggregate numbers are higher. 17.6 million U.S. MySpace users make more than $100,000 per year.

Also true of MySpace users, according to Nielsen: 63% own homes, 86% are registered voters and 28% are college graduates. Facebook has similar numbers." from TechCrunch Blog

Eric Hamilton

December 2, 2008 6:23 AM

Why listen to Michael Wolff? Ten years ago - “I think the myth of the Internet is that it is going to come into everybody’s home.”

Hilariously wrong about the internet -- hilariously wrong about MySpace. If you're in entertainment, you're on MySpace, or you're stupid.

In fact, if Michael Wolff was not hilariously wrong about all things internet, nobody would even know his name.

Mediadavid

December 2, 2008 8:59 AM

Once again, Mr Wolfe seems to have confused his media hopes with reality.
MySpace won't collapse. AOL was never even remotely close to the MySpace phenomenon.
Only someone who is not very familiar with both entities would make this argument (or someone who just doesn't like MySpace and wants it to disappear).
While it's true MySpace isn't for Mr. Wolfe, it is for a lot of folks.
(although personally, I prefer Facebook)

Erin C

December 2, 2008 9:44 AM

Actually, if you're in "entertainment" legitimately, you'd have an agent who'd advise you against such idiotic behavior as a MySpace profile. Unless of course your target market is tweens/teens, in which case it could be beneficial from a marketing standpoint.

Indie bands aside, the 'entertainment industry' on MySpace consists of countless D-grade amateur "models" and "actors" attempting to be discovered, a fact which is sadly hilarious. If you want to be in entertainment, get an agency. If you can't get one, well, perhaps it's time to explore other career options.

MySpace is over and has been for a long time. When BusinessWeek's doing an article about it, you know the online community has already left in droves.

Second That

December 2, 2008 10:43 AM

Michael Wolff isn't just wrong about the internet; all his media predictions are wrong too. Pick any of his VF columns from the past 2 years and the arguments in them are guaranteed to be wrong. MySpace does eat balls though.

Rebecca Lieb

December 2, 2008 11:37 AM

linkbait.
nothing but patently obvious linkbait.

Sean

December 2, 2008 11:46 AM

What's so great about the Facebook "experience" vs. the myspace "experience?" The whole point of online social networks is voyeurism, and there's precious little of it on Facebook. Instead, try thumbnails, low-quality pix (it appears they downgrade JPEG quality in order to save server space) and a helter-skelter interface that's annoying and illogical.

At least myspace is simple, well-organized and focused on communication of one person's info--and photos, and blogs, and videos--to another. Comparatively, facebook is just a mess. It's telling that the people who use facebook are inevitably old friends from high-school who are "just getting into this online networking thing." Their interest in it as a service, as a useful part of their daily life, is minimal at best. Most younger people have both a facebook and myspace account.

Don

December 2, 2008 12:01 PM

I counter that Erin C should show even one single B list celebrity who is not a long-established star who does not have a legitimate MySpace presence.

We are aware that MySpace is where people trying to get a start post their headshots, but that banal enormity has existed in every single casting guide since the Academy Players Directories (I own copies going back to 1939 and they are filled with character actors half-remembered from westerns and never-were starlets with Pasadena Playhouse credentials).

I am not aware that any single agent has advised against a MySpace profile and cannot fathom an agent doing that. The concept she uses of being in entertainment "legitimately" is a clue that Erin C is not speaking from industry experience. Legitimate new actors and musicians use MySpace as fan club management, following a pattern that made Dane Cook a hit.

That said, it's also silly to suggest that the MySpace model has infinite legs and will exist with this level of popularity and valuation for time immemorial is just silly, and I presume not exactly what Jon was suggesting.

The AOL example is a good example. The AOL-only features kept people from switching until their were enough alternatives and negative publicity about AOL for many users to jump ship. The next MySpace could well be an 11th generation combination of Twitter, Flickr and google maps. It could be classmates.com mixed with youtube and internet radio dedications. The idea that none of us here could have predicted the popularity of Scrabulous 5 years ago shows that for the most part, this kind of prediction doesn't work.

But MySpace will fall some day, just as we will all die some day.

Heather Mansfield

December 2, 2008 12:29 PM

Yeah... MySpace is abundant in "Cretins":

http://www.myspace.com/nonprofitorganizations

Ex Wolff New Media Employee

December 2, 2008 12:36 PM

Michael Wolff wouldn't know an Internet success story from the failed company he created and then left, taking all his staffers deferred salaries with him and his beard to Italy.

Bryan

December 2, 2008 1:09 PM

Michael Wolff is a NOBODY. That's probably because he can't make an educated argument. These media characters pop-up all the time like blips in the cosmos of the bigger picture.

While I dont care for MySpace and think it's eventually gonna whither away into obscurity, I don't think this guy is anywhere near being on point.

Myspace will be eventually forgotten like most general social networking sites because it depends soo heavily on people finding enough spare time in their day to keep their pages and habits.

All social networking sites will have discover new ways to make themselves relevant to users' real, daily lives.

I also don't think MySpace ads have that high a click-through and pay-off rate. It's all junk for the most part.

Ron Mwangaguhunga

December 2, 2008 4:10 PM

Yeah, but does anyone here go on MySpace hourly or even daily to check theor messages? I think Wolff was unnecessarily harsh -- some high school kids do go on MySpace to hook up -- but aside from bands keeping in touch with their fans the prospects for the site appear pretty bleak.

The odd thing is that News Corp could have pushed MySpace using the hugely influential Page Six and popular Fox TV (24, Prison Break, House) and FX properties(The Shield, Nip/Tuck). Could you imagine if you had to register through MySpace to get your gossip fix at PageSix (instead of PageSix.com)? Or what if friending characters like Jack Bauer of 24 or Dr. House or The Simpsons on MySpace would get you updates on show plotlines or a robust MySpace Simpsons-Springfield community.

But they didn't. And now facebook is eating MySpace's lunch.

Neil Suttree

December 2, 2008 4:20 PM

Cretinism is in. Sarah Palin and Foxworthy prove that people are proud of being ignorant. This can only bode well for social networks.

BridgeTroll

December 2, 2008 4:56 PM

"And those comments about MySpace users being poor and uneducated aren’t entirely correct either. Of MySpace’s U.S. users, 52% make more than $60,000 per year, which is far from poor. 23% make more than $100,000 per year. Just 11.6% make less than $25k/year."

This got to be a joke! If you REALLY think those stats are real, i have a bridge to sell you.

Nate

December 2, 2008 11:45 PM

I second "BridgeTroll."

No way in hell over half of MySpace users make upwards of $60,000. No way.

William Gaultier

December 3, 2008 2:47 AM

I second BridgeTroll, the data that MySpace publishes has been talked about in the advertising industry for a long time. A lot of it is really bad data that can't be relied on. Most importantly though, for many of our clients, all advertising buys/tests we have conducted on MySpace have done REALLY poorly in terms of clickthrough, viewthrough and good old ROI. So MySpace's audience is not as valuable as it seems.

Jay Krall

December 3, 2008 9:01 AM

Great point. If you're in a band, you have to be on MySpace. That's a good lesson in finding your community online: don't assume they're on Facebook just because it's the newer and hipper of the two.

Dave

December 3, 2008 11:41 AM

Marketers who are not savvy with social media will not get the right ROI on their ad campaigns on social networking sites. They don't know what to measure and how to measure them, so they use CTRs or view-throughs as success metrics. My suggestion is - don't blame the social networking sites (Myspace or Facebook), but instead, try to learn how to effectively market in the social media space.

John

December 3, 2008 10:10 PM

Eric C-- please define "legitimate" entertainment. Please, do tell... I'm dying to hear. Oh the half-wits you will meet.

Ben Joven

December 4, 2008 4:22 PM

Being a man "of ethnicity", I took an offense to a comment and observation recently made by an ex-girlfriend(who is also a fellow online marketer), that may or not hold some truth, stating, "...Myspace is for poor, black, Hispanic uneducated kids and Facebook is for white college kids."

At the time I was taken aback but the truth was I was growing tired of MySpace. It seemed like most of my "friends" were complete strangers and by the looks of their profiles they were aspiring porn stars and not to mention, the blaring music was killing me-an obvious bust at work, announcing that no work was being accomplished in my cubicle.

On a positive note, MySpace is EXCELLENT for musicians. There is not a more effective and cheaper virtual "stage", barring YouTube, to get huge exposure. Some bands wouldn't exist or be as successful if it wasn't for MySpace.

But for the most part I hate generalizations, and Michael Wolfe's inductive reasoning is the type of thinking that spreads dogmatic, narrow mindlessness and if I get a friend request from Michael Wolff I will, politely, deny it.

linda

December 5, 2008 11:56 AM

Cretins? Ha, you utter snob. I have a college degree and wouldn't be caught dead on Facebook. I've been on MySpace since it began and I'm not leaving.

You have some nerve!

Don D in LA

December 6, 2008 9:38 PM

MySpace had a purpose and it might still have one in the future.

I do marketing and promotion for comedians and we found that MySpace was cool and all, but we decided early on that it wasn't the end all be all.

You can spend a lot of time building up your "fans", but you really don't have control of them. What if they get bored with MySpace and move to the next big thing in Social Networking. It would be a waste of money and time invested.

You don't have a lot of control with the "fans" as far as knowing any real information. It was a shotgun approach to collect them. You would send emails out to people and invite them to be your friend. You never knew for sure where they were from so you couldn't do pinpoint marketing for upcoming shows. You could only send out to the masses the "bulletin" to encourage your "fans" to come to a show.

If you have your own domain you are much better off. You use MySpace to direct people to your own domain where you can have people fill out a form extracting necessary info like location, and how they find you when they would sign up for a newsletter. At that point you have full control over your "fan" because you have their contact info and you know how to market to them.

Now with technology advances you can actually build your own "community" on your domain. There can be that social networking feel within your own website.

A lot of people I have dealt with have that "light bulb" moment when I tell them they don't need MySpace.

daniel schwartz

December 24, 2008 11:24 PM

im 18 and wolff is so on about myspace people its great

artie

January 11, 2009 2:00 PM

Wolff is right on this. Any of these companies can go the way of Yahoo and every other fly-by-nighter. Google is not immune.

The social web is now in decline (even though it appears to be increasing worldwide)because it's growth is non-US. People are leaving in droves in the US because the social web does not offer a community of substance. It was a fad. A fad that profited a few people a whole lot but has done little to empower people.

http://foc08-artie.blogspot.com/

Post a comment

 

About

The media world continues to shapeshift as new forms arise and old assumptions erode. On this blog, Bloomberg Businessweek will provide sharp analysis and timely reports on the transformation of this constantly changing terrain.

Categories

 

BW Mall - Sponsored Links

Buy a link now!