(above, Facebook beating MySpace in Australia with the crossover at Oct 07)
MySpace versus Facebook
As some of you know, I’ve previously written about the MySpace versus Facebook topic, both a year ago in the post Wanna bet? In 1 year, will Facebook be bigger? Or will MySpace? and MySpace versus Facebook: Winning in the US, Losing internationally. In general, I’ve taken a fairly pro-MySpace stance, since I think there’s a lot of qualities of the site which are lost on the typical technogeek here in San Francisco.
That said, it’s undeniable that MySpace has been losing ground internationally, while both have plateau’d here in the US. Interestingly enough, I think the fact that it’s possible for a newer product like Facebook to overtake MySpace creates a surprising argument:
Social networks have weaker network effects than previously speculated
After all, if the networks effects would be strong, you’d figure that MySpace would be able to hold onto their lead anywhere, regardless of product quality, when in fact that hasn’t been the case.
Playing around with Google Trends
After reading many mentions of this new product, I decided to play around with Google Trends tonight. I started to compare MySpace versus Facebook traffic from around the world, since you can, for example, ask how MySpace versus Facebook is doing in the US, over the maximum time period.
A *big* caveat on the discussion below is that obviously the Google Trends product is new, and lacks any track record on how accurate it is. You can consider the following discussion very much contingent on these factors – if anyone wants to do a similar view of this in comScore or another service, would be happy to link to it! (A recent but coarser chart of comScore numbers can be found here)
Analysis of traffic trends, domestically and internationally
Anyway, here are a couple thoughts come out when you play around with the “major countries” listed in the Google Trends product:
- First off, MySpace is staying dominant in a few countries, like the US, Germany, Italy, Japan, etc
- Across the board, MySpace is the incumbent, and Facebook is coming from behind
- However, Facebook beaten MySpace on traffic in 14 countries over the last year
- In particular, June ’07 to Oct ’07 was particularly rough for MySpace, where 10 of the 14 countries were passed in this period
- In the markets where MySpace leads, you may consider them “mature” markets in the sense that both services have plateau’d in traffic – it’s not like MySpace growth is outpacing Facebook’s
Here’s the full table of data, so you don’t have to do the work:
| country | myspace leads | facebook leads | crossover date |
| Australia | X | Oct-07 | |
| Austria | X | ||
| Belgium | X | Nov-07 | |
| Brazil | X | ||
| Canada | X | ||
| China | X | May-07 | |
| Denmark | X | Oct-07 | |
| Finland | X | Sep-07 | |
| France | X | Nov-07 | |
| Germany | X | ||
| Hong Kong SAR China | X | ||
| India | X | ||
| Italy | X | ||
| Japan | X | ||
| Netherlands | X | Mar-08 | |
| Norway | X | ||
| Portugal | X | ||
| Singapore | X | Jun-07 | |
| South Korea | X | Sep-07 | |
| Spain | X | May-08 | |
| Sweden | X | Jul-07 | |
| Switzerland | X | Oct-07 | |
| Taiwan | X | Apr-07 | |
| United Kingdom | X | Jun-07 | |
| United States | X |
Pretty interesting right?
Overlaying advertising markets
Now, the second question is, how do advertising markets play into this? After all, it’s not enough to win on traffic, but you want to win on valuable traffic. For this discussion, I’ll borrow a diagram Jeremy Liew from Lightspeed wrote about regarding ad spend both domestically versus internationally, in 2007:
Here, you see that the US is by far the largest ad market, and is worth more than the rest of the world combined. I think that’s a key observation. Another observation can be made by combining this diagram with the traffic table above:
| country | myspace | crossover | 2007 ad spend (MM) | |
| United States | X | 19500 | ||
| United Kingdom | X | Jun-07 | 4727 | |
| Japan | X | 3397 | ||
| France | X | Nov-07 | 2548 | |
| China | X | May-07 | 1269 | |
| Germany | X | 1142 | ||
| Canada | X | 950 | ||
| South Korea | X | Sep-07 | 779 | |
| Brazil | X | 400 | ||
| India | X | 86 |
From this view, you can see that MySpace and Facebook are really trading blows in the larger markets. While the MySpace lead within the US is obviously the most important, from a revenue standpoint, it’s obviously not a good thing to see Facebook overtake MySpace in the UK, France, China, South Korea, and India, which are key markets.
Obviously, the best way to do this analysis would be to do a weighted sum of the market share in each country, but because there’s so much variance in CPMs based on how they are selling, a more granular model might actually create false assertions. If anyone has better data, would love to get it and would gladly repost here.
Conclusions
There are a couple key things here which I think are pretty interesting and important:
- MySpace leads in the major market (the US) but is losing ground overseas
- The overseas losses are material losses – not just random non-revenue countries
- The major losses all occurred in the mid/late 2007 timeframe
- Several markets are plateauing in traffic, meaning that the social network market is starting to mature – consider that MySpace+Facebook uniques, duplicated, is over 90M active users, which is a huge percentage of the online audience in the US
- How strong are the network effects of social sites, if incumbents can be displaced? Maybe it’s not so strong after all
Comments or suggestions welcome!
And please link to me if you like this article :)
UPDATE: Chuck Lam does a good analysis of the fact that China (and possibly other countries) are using domains other than Facebook.com and MySpace.com. For example, China is all about MySpace.cn, and leads Facebook in that regard.