DeWolfe: Recession Hammering MySpace's Growth

MySpace CEO Chris DeWolfe told a Reuters conference that following the worldwide financial crises, MySpace hasn’t “really seen any impact, other than we think we could have grown even more than we have.”

Translation: We’ve seen impact, but we’re still growing–for now.  Chris then goes on to set expectations very low:

“Our revenue and profits are significant and they continue to grow in spite of the poor economy. We’re up 18 per cent year-over-year as of last quarter and we’re cautiously optimistic that we can continue to grow our business.

“Cautiously optimistic that we can continue to grow.”  That’s a distinct change from prior expectations.  And Chris’s caution makes sense, based on what we’re hearing elsewhere in the industry:

  • We hear that when advertisers cut their budgets under new constraints, the first thing to go is experimental social media.
  • Network of networks the Rubicon Project says social media ad spending dropped 3% for ad networks, 8% for young adults sites and almost 20% on entertainments 3. MySpace is all those kinds of sites in one.
  • MySpace also depends on display advertising, which we’re pretty sure will decline in 2009.

See Also:
Ad Rates Dropped 11% In The Third Quarter

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