Rupert Murdoch was one of the keynote speakers at the 2007 Media Summit and one one of his statements became very popular on Digg. It's the statement that says Myspace was getting $25M in ad revenues per month. While the statement is correct, the comments on Digg were missing some of the facts, and there were a few other very significant statements Rupert Murdoch made that should be widely known.
First of all, Myspace revenues from advertising is at $25M/mo and growing 30% per quarter, but this revenue does not include search revenue from Google. The $900M deal is going to start kicking in next year. As far as pure advertising goes, $25M/mo is phenomenal, but low compared to the 150M registered users they have, and I'll get to that later.
Much more interestingly, Myspace launched a mobile app with Cingular, allowing Cingular subscribers to access Myspace profiles on their handsets. the application costs $3/mo, where $2 goes to Myspace and $1 goes to Cingular. The most amazing thing about this service is that 200K people has subscribed to it in the first six weeks of the service and it's on one carrier so far. If it goes at this rate, in one year the application will be the most poplular mobile app ever, passing the likes of MobiTV, and can easily surpass the $25M/mo ad revenues.
Looking back at the numbers $25M/mo in advertising with 150M users is a very scary number. Any social network with 5M users would be considered successful by VC's and that would correspond to a mere $10M/yr business. Secondly, the data shows how low the CPM's are on Myspace. My calculations are that each pageview is worth less than 3/10ths of a cent. That means that Myspace is really a volume game. They get really crappy ads, but they just have a lot of pageviews. My hat's off to them because this will be very hard for others to replicate, in the US at least.
Finally, about the $1B, Rupert Murdoch said that with the search revenue in 2008, and the organic growth of ad revenues, and the addition of revenues from IGN, Fox Interactive will get to $1B in revenues in a year or so. That's impressive.