June 9th, 2006

MySpace Is The Most Expensive Data Mining Project Ever

by

“We have a lot of work to do,” said Ross Levinsohn, President of Fox Interactive. Got that right. According to Levinsohn:

“The digital gold inside of MySpace wasn’t the number of users, but the information they’re providing, structured and unstructured data,” Levinsohn said–both demographic and psychographic data that Fox Interactive can use to suss out the brand preferences of young people on the Web.

Levinsohn said that the site isn’t intended to be like a portal, and that “it’s more about [users] presenting themselves to the world” by creatively expressing themselves through their MySpace profiles. “It’s important for us not to suppress that–not to push content,” he said.

So if I follow this latest contortion on the rationale for the $580-million-dollar purchase of MySpace, it’s all about data mining.

Which means that MySpace is officially the most expensive data mining project ever. For that price, they could have bough three market research companies. Or paid 1 million teenagers $500 to participate in focus groups.

But wait, what teenagers post on their MySpace pages is a “pure” reflection of their consumer habits, some will argue. Well, maybe, but I’d love to hear Levinsohn hold forth on exactly how they plan to data mine the chaotic slather of content on most MySpace pages.

It’s notable that the rationale for News Corp’s purchase of MySpace seems to be changing as often as the rationale for the Iraq war.

As for advertising on MySpace, which was supposed to be the big victory for News Corp:

More mainstream marketing on MySpace will be kept to the “well-lit” areas of the site, like the Books, Comedy, Film, and Games sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.

Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally. And even if they could, most advertisers wouldn’t take the risk of appearing on individual pages anyway.

For the sake of their shareholders, I hope News Corp has a plan to turn all that MySpace “data” into dollars.

Comments (22 Responses so far)

  1. Scott Karp at Publishing 2.0

  2. while Gusto will use their financing “to expand our marketing and editorial development initiatives.” In other words, Gusto will edit and write a lot of the stuff themselves. Hmmm. Over on Publishing 2.0, Scott Karp writes about how MySpace is themost expensive data mining project ever. He concludes, “For the sake of their shareholders, I hope News Corp has a plan to turn all that MySpace ‘data’ into dollars.” Finally, following up on an earlier post (and now on a bit of a tangent) Valleywag sees

  3. sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.” “We want to make it easier for marketers to work with us,” Levinsohn said.   I like the wayScott Karp reacted to the announcement when he wrote, “Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally.” Heh.. funny! My reaction was similarly skeptical, because it seems that a traditional media mind set might be

  4. sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.” “We want to make it easier for marketers to work with us,” Levinsohn said. I like the wayScott Karp reacted to the announcement when he wrote, “Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally.” Heh.. funny! My reaction was similarly skeptical, because it seems that a traditional media mind set might be

  5. sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.” “We want to make it easier for marketers to work with us,” Levinsohn said. I like the wayScott Karp reacted to the announcement when he wrote, “Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally.” Heh.. funny! My reaction was similarly skeptical, because it seems that a traditional media mind set might be

  6. sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.” “We want to make it easier for marketers to work with us,” Levinsohn said. I like the wayScott Karp reacted to the announcement when he wrote, “Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally.” Heh.. funny! My reaction was similarly skeptical, because it seems that a traditional media mind set might be

  7. That said, it does get me thinking – how much do people really care about who has access to their data, usage habits etc.? Perhaps this is just a few of us and in reality convenience is more important? [Update:MySpace is the most expensive data mining project in the world] Dave Tosh :: Blog http://www.makepovertyhistory.org

  8. обстоятельством». «Мы хотим, чтобы участникам рынка было проще с нами работать», — пояснил Левинсон. Мне понравилось, как на эту новость отреагировал Скотт Карп (Scott Karp), который написал: «Звучит скорее как обещание изолировать рекламу подальше от главного события, как было с

  9. “我们希望市场营销人员更容易地和我们一起工作。” Levinsohn说。 我很喜欢Scott Karp对这一声明的反应,他写道:“听起来更像广告将被从用户行为中圈禁起来,就如同参加布什集会的抗议者一样。”

  10. sections rather than on individual profile pages, which have less strict content controls–something many advertisers have expressed concerns about.” “We want to make it easier for marketers to work with us,” Levinsohn said. I like the way Scott Karp reacted

  11. “??????????????????????” Levinsohn?? ??????Scott Karp?????????????“????????????????????????????????????”

  12. [...] Publishing 2.0 The Business of Publishing in the Digital Age « MySpace Is The Most Expensive Data Mining Project Ever | Home | [...]

  13. btw: Pentagon sets its sights on social networking websites

    That data *is* the gold of MySpace. I believe I’ve mentioned it before here. And users are giving it up freely without understanding its value or the consequences of doing so.

  14. gimme a break. news corps buy of myspace is looking like the smartest and cheapest buy of any site in history. published reports say 350 million in rev this year for a 580 buy. wow. these guys have a strategy and its to make money

  15. Jack — I haven’t seen that $350 million revenue projection — what is your source? Can you provide a link?

  16. [...] So … How’s my favourite Tar Heel? Used the “make it worth our while” quote in a meeting with a leading European telco today. Went over big time. Credited some Tar Heel PhD candidate. The one American at the table understood. The others looked at me like I was from another planet. I love London … Was reading a couple other posts on your blog. All quite interesting. You might want to check out: Visualizing the Social Network with regards to how blogs are the glue that keeps social networks stuck together – fits with your piece on Collaborative Reference Work. Also of note is MySpace Is The Most Expensive Data Mining Project Ever, a great post by Scott Karp. ~G~ Posting your comment… [...]

  17. Scott,

    I don’t think the $350/year is unreasonable. In fact, it could be light given the 30B pageviews/month they’re doing now. Massive massive numbers. Even with a tiny CMP or CTR, they’re making piles of cash. That is to say nothing about the revenue from the homepage:

    Not sure where Jack saw it, but I read the AdAge article about MySpace’s homepage making over $1M/day in revenue thanks to deals with Disney and Pepsi, among others.

    I blogged it here last week:
    http://www.i-boy.com/weblog/2006/06/1-million.html

    Love your blog, btw. Great stuff.
    ~G~

  18. [...] I like the way Scott Karp reacted to the announcement when he wrote, “Sounds more like advertising will be roped off away from the action, like protesters at a Bush rally.” Heh.. funny! My reaction was similarly skeptical, because it seems that a traditional media mind set might be nudging them (FIM) in the wrong direction. [...]

  19. My Space Business Model. …

    Nokia Live 8 Ad Originally uploaded by bigmick. For Zapr, data mining the joy and the perils hasnt’ even hit the ‘All Other Business’ radar yet. Metrics – YES. Profiles – YES. But the value and privacy issues is another…

  20. [...] Source: What Myspace means to Murdoch – BBC Further reading: MySpace is the most expensive data mining project in the world [...]

  21. [...] I don’t think this will come as much of a surprise to anyone, but it appears MySpace accounts are easily phished. This probably wouldn’t be so bad except that people put everything about their lifes into social networking sites and there are tons of minors on it and it is owned by an evil advertizing company and it was founded by people who build data mining software (okay, I’m not sure how those last two play a part in this but I still don’t like it). [...]

  22. [...] MySpace as a data mining business Here is an interesting article about how News Corporation changes the reasons on why they really purchased MySpace. The writer claims that MySpace is a giant data mining operation in reality and that News Corporation must find a way to take advantage of this to justify the 580 Million dollar price tag. __________________ Domain Name & Website Exchange Search Engines & Top Directories Search Engine Research TV Stations [...]

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