NYT 1/24/05 Friendster, Love and Money
Just as troubling, a younger, flashier rival called MySpace has eclipsed Friendster, at least in the United States, among those in the most highly coveted 18 to 29 demographic. And Friendster loyalists have groused that the company has done almost nothing to enliven its site.
"I think Friendster really missed their big opportunity," said Mark J. Pincus, who is an investor in Friendster and the founder of Tribe Networks, a budding social networking Web site that hopes to capture some of the print classified advertising market. "They weren't quick to turn on new functionality, where a company like MySpace kept innovating and adding new features."
That sentiment was echoed by a Friendster employee who recently left the company. "The service was growing faster than we could keep up with, so we spent all this time making sure the service was stable," said the former employee, who spoke on the condition of anonymity. "A lot of people were frustrated because we weren't rolling out a lot of features but instead working on infrastructure."
Mr. Doerr would not provide details about Friendster's business plan except to say that the company would announce a partnership deal in February that "I can only describe as huge." And he said last week that Friendster would "reach profitability within the next 90 days." There is no cost for joining or browsing Friendster; advertising on the site generates most of the company's revenues.
Friendster can boast more registered users - 16 million - than the 7.6 million who have registered at MySpace. But data provided by Nielsen/NetRatings and comScore MediaMetrix, two firms that measure domestic Internet traffic, tell a different story.
More than five times as many people visited MySpace as Friendster in December, according to Nielsen/NetRatings - and they spent far more time there. The average visit to Friendster was less than 17 minutes, the rating service found, compared to 78 minutes at MySpace. And MySpace logged more than 2 billion page views last month, according to MediaMetrix, compared to 152 million page views at Friendster.
MySpace began primarily as a music site where users, after posting a profile, could organize around favorite bands, hear snippets of new songs and find out who was playing where and when. MySpace now hosts sites for 110,000 musicians, and the rock group R.E.M. is among the bands that have used the site to pre-release new albums. Users can converse via instant message, play games, contribute to blogs or browse through a range of local cultural events.
"I had never been interested in investing in a social networking site," said Geoffrey Y. Yang, a venture capitalist with Redpoint Ventures, who said he is days away from investing in MySpace. "But these guys in a sense are trying to be an MTV for the Internet, where social networking is just a key piece around which everything else revolves rather than social networking per se."
Orkut began as a plaything for Silicon Valley's digerati but, oddly enough, has morphed into a site where the primary language is Portuguese. Nearly two in three registered Orkut users hail from Brazil; Americans account for only one in 11 registered users. Similarly, Friendster is wildly popular among 18 to 21 years olds living in Indonesia, Singapore, Malaysia and the Philippines, who account for a huge portion of Friendster's most active users.
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