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Friday, October 06, 2006

MySpace Takes On The Four Horsemen Of The Internet

"Outlined against a blue, gray October sky the Four Horsemen rode again."--Grantland Rich, The New York Herald-Tribune. October 18, 1924.

So, it turns out that the people using MySpace are not just pot-smoking twenty-year old slackers. Recent data from comScore indicates that half of MySpace's US users are over 35. With 56 million unique visitors in August, MySpace is beginning to rival AOL, Yahoo!, MSN, and Google as a huge web destination. AOL's unique visitor count in August was 89 million.

Common wisdom has been, at least since Google became a big deal two years ago, that the four large internet destinations would fight for the lion's share of online advertising dollars. According to industry statistics, these four websites not only dominate online advertising revenue, their ad dollar growth rate is faster than the internet as a whole. It have appeared, at least until this year, that no other web property could compete with the four portals.

The emergence of MySpace is not good news for the four properties that have sucked up most of the internet ad dollars over the last few years. The growth rate of internet advertising is slowing, and now there is one more large mouth to feed.

Yahoo! has already warned the market that its revenue for Q3 will be at the low end of expectations. If News Corporation can take advantage of the huge MySpace audience, especially now that the myth about its demographics has been debunked, AOL, Yahoo!, MSN and Google will have to watch their share.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

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