Time Warner is casting AOL out onto the street by the end of the year. News Corp’s MySpace has seen traffic and revenue decline so fast the site has gone from “Who’s Who” to “What’s That?”
Why is it that traditional media companies have such a difficult time with new media properties?
Ten years ago Ted Turner said the merger of AOL and Time Warner was “better than sex.” Rupert Murdoch, upon buying MySpace in 2005 said “young people don't want to rely on a God-like figure from above to tell them what's important.”
There were both right and both wrong.
Both companies hyped the value of new media, then promptly tried to run them like their other media properties, where change is predicable and innovation glacial.
Time Warner milked the AOL dial-up service cow for all it’s worth, finally hitting on a money making strategy to own separately branded, ad supported destinations like MapQuest, Moviephone and Engadget.
MySpace, once the highest flying of the social network sites (and still the highest revenue producer) is seeing traffic and ad revenue decline and shift to rivals Facebook and Twitter almost as fast as users can type 140 characters.
MySpace is still the destination of choice for the young and the restless, but not so much for adults who have discovered the power of social networks. MySpace traffic fell 2% in April 2009 compared to 2008. Facebook traffic grew 89% over the same period. Ad revenue you ask? MySpace is projected to drop 15% and Facebook to climb 10% this year.
Why the rapid reversal of fortunes for MySpace? Web users, especially social networkers, are not like newspaper readers and television viewers. They are more demanding, and with an infinite supply of sites that will cater to their needs (and whims), very fickle.
Let this be a lesson to all owners of new media properties. Listen to your users. If you’ve been running a newspaper or television empire, they know more about what needs to be done than you do.
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