Last spring I wrote a post “Has The MySpace Downturn Begun?” Dan Mitchell at NYT picked it up in a piece “MySpace No Longer Their Space?” My post was purely speculative and, not surprisingly, completely wrong. But the fact remains that MySpace belongs to News Corp, not MySpace users, which is why News Corp can set the rules for ItsSpace, such as blocking third-party widgets like Photobucket.

MySpace blocked Photobucket because it was serving ads on MySpace without paying MySpace — the reaction in the blogosphere has focused on the implications to Web 2.0 business models — see Om Malik’s 5 lessons and Nick Carr’s sharecropping analogy.

The more interesting question to me — and the one that will have the greatest business consequences — is how do MySpace users feel about this? Clearly, most of them don’t know nor could care less about the spat over who controls the ad revenue. All they know is that their Photobucket videos suddenly went kaput.

Last year, I might have argued that this was a bad omen for MySpace. Now, I’m not so sure. After all, video hosting is fast becoming a commodity — MySpace users can turn to dozens of different service providers to replace Photobucket.

I bet most MySpace users are savvy enough to know it’s not really THEIR space — and I bet most of them don’t care.