All Things Digital

MySpace is no longer just “a place for friends,” deceptively flattering photos and seizure-inducing Web page design, but a place for the music industry as well. This morning the company rolled out MySpace Music, the music destination site with which it hopes to take on Apple’s (AAPL) iTunes. MySpace Music, in the words of MySpace CEO Chris DeWolfe, is a mega-music experience. “This is really a mega-music experience that is transformative in a lot of ways,” DeWolfe enthused earlier this year. “It’s the first service that offers a full catalog of music to be streamed for free, with full community features, to be shared with all of your friends.”

And it certainly is that. With all four of the largest labels on board–including EMI, which signed on just yesterday, free ad-supported streaming of their catalogs, as well as an Amazon-powered digital music store that sells MP3s playable on the iPod and most other devices–MySpace will go down in history as the biggest Amazon (AMZN) affiliate ever–MySpace Music could become a powerhouse in the digital music space. And quickly, too, with 120 million global users, about two-thirds of whom already stream songs to their MySpace pages.

A big number, 120 million global users. Napster, at its February 2001 peak, had just 26.4 million users worldwide, to whom it promised free music. And look what it did to the industry.

“When Napster went and set the content free, it was this incredible music experience for users, but it was illegitimate and it didn’t have a business model backing it,” MySpace COO Amit Kapur told Wired.com. “That also wasn’t designed to win … how do we create an experience that is designed to win? How do we align the interests of every constituent involved in this process? And that is what we believe we’ve done.”

Could be. Clearly, the venture is a noteworthy step for the music industry, whose failure to embrace digital distribution early on has cost it dearly. And it’s one that could pay off. “MySpace has the audience and environment to enable the music industry to get to the next digital level,” Forrester (FORR) analyst James McQuivey told News.com when the effort was first announced. “What iTunes offers is a good buying experience, but that’s not all people do with music. They talk about it, they share it, they try things out. Remember, this is the kind of activity that (record label) Universal Music Group was suing MySpace for previously. I think the labels said to themselves, ‘Oh, if we enable fans to have a fully immersive experience, they might spend more on music.’ MySpace can offer a place where all aspects of the music experience can be expressed. Imeem was getting close to this, but MySpace, if they don’t mess it up, should take Music 2.0.”

[Napster Chart Credit: Wikipedia]

The best thing about social networks is also the worst thing about social networks: They make it easy for us to share information about ourselves.

Of course, by making that information easier to share with friends and colleagues, social networks are also making it easier to share with less “social” entities. Among those are hiring managers, who are increasingly surfing social-networking sites for background info on job candidates. According to new research from online job venture CareerBuilder, nearly a quarter of hiring managers review the social-network profiles of potential employees–22 percent. And of those, 34 percent found material contentious enough to drop a candidate from consideration–discriminatory remarks, trash talk about former employers, and, of course, provocative or inappropriate photographs.

Makes you think twice about posting those “innocuous” pictures from Burning Man to your Facebook profile, even if you did look great in silver body paint.

It’s worth noting as well, though, that 24 percent of hiring managers surveyed reported finding information that impressed them or influenced their hiring decision favorably.

As in search, in Web video Google is the one to beat.

Americans viewed some 11 billion videos during July, and they watched most of them on Google sites, according to the latest metrics from comScore. Of the more than 11.4 billion videos viewed in the month, nearly 44 percent were seen on Google (GOOG) properties. And 98 percent of those were viewed on YouTube, which continues to dominate the online video space. The remaining 55.9 percent was split among nine properties led by Fox Interactive Media and MySpace (NWS), which ranked a very distant second to Google, with just 3.9 percent of videos viewed. None of the remaining eight sites even cracked three percent.

So who’s watching all this video?

Answer: nearly 142 million U.S. Internet users–almost 75 percent of Americans with Internet access. On average they spent 235 minutes watching video in July. And they rarely spent more than 2.9 minutes on any one video, which makes perfect sense when you think about it. “Dramatic Chipmunk” is just five seconds long, and I’m told it’s the greatest video on the Internet.

Social-networking sites may be nearing a plateau in North America, but they’re hiking diligently upward abroad. Worldwide usage of social- networking sites has grown by 25 percent in the last year, according to a new study from comScore. That’s more than double the 9 percent growth seen in North America.

This rising social-networking tide overseas is, of course, lifting all boats, but none higher than Facebook. With 132 million unique visitors in June–up 153 percent from the same month a year earlier–Facebook is now the largest social network in the world. Its biggest rival, MySpace, had 117 million users in June, a 3 percent increase over last year. Why the gross disparity? Thanks to its new Translations application, Facebook now dominates several markets where it was once relatively unused. In fact, nearly 63 percent of Facebook’s users are outside North America. That’s the sort of thing that happens when you manage to translate your site into 89 languages.

Tell me why you aren’t going to be the next Friendster.”

– Venture capitalist David L. Sze’s 2006 litmus test for entrepreneurs who claimed to have the next MySpace.

If Orkut is the Facebook of Brazil, then Friendster is the Orkut of Asia. The company, which created the social- networking market only to forfeit it to Myspace and Facebook, is apparently doing quite well in Asia. So much so, that it’s used its success on that continent to secure some new venture funding and a CEO with a Google (GOOG) pedigree. In a statement proclaiming itself the No. 1 social network in Asia this morning, Friendster named Richard Kimber, Google’s Managing Director of Sales and Operations for South East Asia, as CEO. The company also said it has raised $20 million in new venture funding from DG Ventures, Kleiner Perkins Caufield & Byers, Benchmark Capital, DAG Ventures, and the Founders Fund. Friendster plans to use that money to hire up and bolster its presence across Asia, specifically Singapore, the Philippines, Malaysia, and Indonesia.

Perhaps, we’ll see that Friendster movie yet–though I still can’t imagine a worse concept.

The hammer has fallen once again on Stanford “Spamford” Wallace. A federal judge in Los Angeles yesterday awarded MySpace a $230 million judgment against Wallace who, with partner Walter Rines, broadcast some 730,000 junk messages to MySpace members in October of 2006.

The judgment is believed to be the largest anti-spam award to date. Not that it really matters, because MySpace (NWS) is unlikely to collect it. Wallace–who was by some estimates responsible for 80% of the spam on the Net back in his heyday–has rarely paid the judgments against him. Moreover, he has a bad habit of disappearing at the first sign of legal trouble.

And that appears to be exactly what he’s done here. Because the $230 million award given MySpace in this case is a default judgment meted out after Wallace failed to appear in court. “It is … a defendant’s responsibility to respond to discovery, obey court orders and avoid dilatory tactics,” the court wrote in its order. “Taking all of the above factors into account, a default is appropriate. The court finds that Wallace’s noncompliance is due to willfulness, fault or bad faith. … Wallace has had every opportunity to avoid the sanction of default. (He) has never provided any explanation for his behavior to the court.”

With Microsoft’s (MSFT) hostile bid looking more and more like an inevitability, Yahoo (YHOO) has apparently decided it’s got nothing to lose by joining Google’s (GOOG) “Everybody-But-Facebook Coalition.”

This morning the company threw its support behind OpenSocial–a Google-led initiative to foster interoperability between social applications–and with MySpace (NWS) and Google, it announced the OpenSocial Foundation, a nonprofit dedicated to the mitigation of perceptions that Google will use OpenSocial for its own benefit.

“… Today … we’ve joined forces with Google and MySpace to create the OpenSocial Foundation, and will also begin supporting the OpenSocial standard,” Yahoo VP of Platforms Wade Chambers said in a post to Yahoo Anecdotal. “Industry consortiums such as this often start slowly and evolve over time. So far, OpenSocial is rapidly growing and adapting, but still in the early stages. We feel that this is the right step at this stage in its evolution. It’s no longer a trial balloon–it’s for real. We are taking this opportunity to help ensure Web sites and developers feel confident using OpenSocial as the building blocks for their new social apps.”

Asked during a February earnings call whether News Corp. might entertain the idea of a MySpace-Yahoo alliance, company Chairman Rupert Murdoch replied: “I think that day has passed, but you never know.”

Well, now that he’s had about a month to think about it, Murdoch seems more certain that day has passed. In remarks at the annual Bear Stearns media conference today, Murdoch said News Corp. has no plans to battle Microsoft (MSFT) for Yahoo (YHOO). “We’re not going to get into a fight with Microsoft, which has a lot more money than us,” Murdoch said.

Assuming Murdoch’s on the level, this is lousy news for Yahoo, which had been discussing a partnership with the media company in the hopes that it might thwart Microsoft’s unsolicited takeover bid. With News Corp. bowing out of discussions, Yahoo’s already limited options for avoiding a Microsoft takeover have dwindled to two: cut a deal with AOL or go to the mat with Microsoft in a proxy battle.

Cue the Jerry Yang sad trombone effect …

I think that day has passed, but you never know.”

–News Corp. Chairman Rupert Murdoch comments on a possible MySpace-Yahoo alliance during last week’s earnings call.

Yeah, you never know.

You’d think that News Corp. (NWS) would be a little too busy with the integration of a certain other multibillion-dollar property to consider adding another one to its plate, but Chairman Rupert Murdoch, as we all know, is a man of healthy appetites.

So it’s not all that surprising to hear that News Corp. and Yahoo (YHOO) are discussing some kind of alliance that would allow the beleaguered Internet major to rebuff Microsoft’s hostile bid once and for all. Sources close to the companies tell The Wall Street Journal that under the terms of the deal being discussed, News Corp. (owner of this site) would take a 20% stake in Yahoo and combine it with MySpace and other News Corp.-owned online properties.