Pete Cashmore has a blog post entitled MySpace: We’ll Crush YouTube where he writes
As if we needed more proof of MySpace’s intolerance of outside development, News Corp. chief operating officer Peter Chernin told investors at an industry conference today that since much of YouTube’s traffic comes from MySpace, it’s time to cut out the middle man. Chernin estimated that around 60-70% of YouTube’s visitors come from MySpace, and as a result he wants to ramp up MySpace Video, giving users less incentive to look elsewhere. But while the 60% figure might not be totally accurate, MySpace is definitely a catalyst for YouTube’s growth - they actually reported a dip in traffic when MySpace temporarily disabled YouTube embeds at the end of 2005 (they were forced to allow them again after a user revolt). But it’s not just YouTube - Chernin expressed distaste for all the services that are feeding the MySpace beast: “If you look at virtually any Web 2.0 application, whether its YouTube, whether it’s Flickr, whether it’s Photobucket…almost all of them are really driven off the back of MySpace, there’s no reason why we can’t build a parallel business.” While I’m not convinced that Flickr gained success on the back of MySpace, Photobucket almost certainly did - ImageShack isn’t mentioned, but it also owes much of its success to America’s leading social network. The sentiments indicate a very worrying trend: MySpace has stated its intention to clone the best tools, and Chernin believes that MySpace can equal or better the third party tools with in-house products.
But it’s not just YouTube - Chernin expressed distaste for all the services that are feeding the MySpace beast: “If you look at virtually any Web 2.0 application, whether its YouTube, whether it’s Flickr, whether it’s Photobucket…almost all of them are really driven off the back of MySpace, there’s no reason why we can’t build a parallel business.” While I’m not convinced that Flickr gained success on the back of MySpace, Photobucket almost certainly did - ImageShack isn’t mentioned, but it also owes much of its success to America’s leading social network.
Marshall Kirkpatrick sums things up in a post entitled MySpace: We don’t need Web 2.0 on TechCrunch where he states
To summarize: the COO of News Corp. says that Web 2.0 is leaching traffic off of MySpace, that they can build their own services to compete with any of it and that there’s going to be an increasingly aggresive commercial push on the site. That sounds both dangerously arrogant and like a real validation of fears that MySpace dependency is too risky for outside developers. Om Malik had a piece in Business 2.0 yesterday titled Suddenly Everything’s Coming Up Widgets, where he said “Everyone’s a winner here: MySpace, because it becomes stickier; YouTube and Slide, because they get the traffic; and the user, because he or she gets it all on one page.” It sounds like MySpace’s owners may not want to play a game where everyone wins.
To summarize: the COO of News Corp. says that Web 2.0 is leaching traffic off of MySpace, that they can build their own services to compete with any of it and that there’s going to be an increasingly aggresive commercial push on the site. That sounds both dangerously arrogant and like a real validation of fears that MySpace dependency is too risky for outside developers.
Om Malik had a piece in Business 2.0 yesterday titled Suddenly Everything’s Coming Up Widgets, where he said “Everyone’s a winner here: MySpace, because it becomes stickier; YouTube and Slide, because they get the traffic; and the user, because he or she gets it all on one page.” It sounds like MySpace’s owners may not want to play a game where everyone wins.
I find this quite surprising. One of the reasons MySpace is where it is today primarily because they stumbled upon the fact that providing a platform for gadgets/widgets allows for richer end user experiences than opening up APIs for viewing and creating content via Atom/RSS/MetaWeblog API which is what blogging sites have traditionally done when building a platform. To turn on the very developers and partner companies that are improving the user experience of your service seems like the road to folly. It's one thing to provide compting experiences to them and quite another to view them as leeches. At Microsoft, we know that the road to success is by building the best platform not just by building the best or most integrated applications. This is a lesson that history has borne out.
This should be a blow to all those VC funded startups whose entire business model is building MySpace widgets. Not to worry, they can always switch to writing gadgets for Windows Live Spaces. ;)