Margaret Simons writes:

G’day mate! I’m the most powerful man in media, thus the
most powerful man in the world, but you should bloody well know that already!
I’m rich and I’m Aussie. ..If you want to watch sport, it’s only if I say so
and if you’re prepared to pay good cash … The fact you can use myspace.com is
down to me because I bloody well own it! Sh*t me mate I own loads of stuff!

This is Rupert
Murdoch’s profile on his most interesting and significant recent acquisition, the social
networking site MySpace. It’s satire of course, but the fact that it exists says some interesting
things about the internet, and the new community-based business models that are
its biggest success stories.

Internet businesses rely,
at a superficial level, on the owners giving up control. Business grows through the contributions of users.
Take Google Earth, which is just a game until you switch on the “Google Earth community” tab. Or eBay, which is nothing but relationships
between buyers and sellers.

MySpace has become as necessary to
teenagers as mobile phones and pimple creams. It had 16 million visitors in
July 2005 when News Corporation bought it for US$580 million, and by the end of
the year had 29 million. It’s estimated to make $13 million in ad revenue a
month.

Building a business on a community sounds
like a cosy thing to do, but as reported here
and most recently in The Economist
(subscription only), online communities can bring all the disadvantages of real
life ones, and then some. MySpace has been used as a tool by rapists and
pedophiles. Adolescent trust and vulnerability are especially easily exploited
online.

And the apparent giving up of control is an
illusion. The MySpace community is its own guarantee of Murdoch’s business
success. There is no need to make it hard for MySpace users to switch brands.
Any user wanting to switch would have to leave all their friends behind, just
as an eBay user wanting to leave would have to dump their marketplace
reputation. Users who create content also create their own brand loyalty.
Community is a comfy shackle.

If, as is predicted, Murdoch uses MySpace to launch movies and
music then MySpace will become a business model unlike anything ever seen
before.

MySpace breaks new ground. Certainly it is
what its users make it. But at the same time it’s about the efficient and
seamless commodification of human relationships. This, I think, is something
new in the world.

Peter Fray

Independent journalism at a Boxing Day price

You knew it was coming, so here it is, our Boxing Day offer. But this is different to the other offers out there.

Dig this: save 50% on a year of Crikey.

Usually $199, use the promo code BOXINGDAY2020 to get half price on your annual membership before midnight December 30.

Peter Fray
Editor-in-chief of Crikey

SAVE 50%