I’ve been watching the death spiral MySpace is in for a while. Back in December I interviewed CEO Mike Jones onstage at LeWeb. Back then I thought maybe MySpace could pull it out, but since then I’ve learned the MySpace “plane” that’s in a death spiral has increased its velocity — in the wrong direction.
Since talking with Mike in December I’ve been asking people involved what went wrong and two common themes have evolved:
1. Their bet on Microsoft technology doomed them for a variety of reasons.
2. Their bet on Los Angeles accentuated the problems with betting on Microsoft.
Let me explain.
The problem was, as Myspace started losing to Facebook, they knew they needed to make major changes. But they didn’t have the programming talent to really make huge changes and the infrastructure they bet on made it both tougher to change, because it isn’t set up to do the scale of 100 million users it needed to, and tougher to hire really great entrepreneurial programmers who could rebuild the site to do interesting stuff.
Here, let’s go back and watch the video with YFrog’s CEO, Jack Levin. He was one of Google’s first infrastructure employees. Now, consider that Silicon Valley has lots of talent like him. Think about the technology he knows. Hint, it isn’t Microsoft. Microsoft’s technology just isn’t used by many serious web companies that I know. Stack Exchange and PlentyOfFish are two notable exceptions and neither is located in Silicon Valley and they hardly are companies with the scale of MySpace used to have (more than 50 million users).
Workers inside MySpace tell me that this infrastructure, which they say has “hundreds of hacks to make it scale that no one wants to touch” is hamstringing their ability to really compete.
For instance, I asked why MySpace didn’t really do anything great with all the Facebook likes I’ve put into that system (that’s a new feature MySpace added late last year, but it doesn’t seem to work very well). Or, when I asked Mike about how he was going to do something like Aweditorium did, he didn’t have a good answer. They answered with the cameras off: they can’t change their technology to really make new features work or make dramatically new experiences like the one that Aweditorium brought to the iPad. And now that they have laid off a lot of people morale is down and hiring is very tough for them, they tell me.
Which gets me to the Los Angeles issue. There just aren’t “web scale” companies down in Los Angeles, and because Los Angeles is such a large place — it can take hours to drive across the city — there isn’t a single neighbourhood that has built up a good talent base, the way Palo Alto or South of Market in San Francisco has.
This bet on Los Angeles doomed MySpace when Facebook came along. Facebook has hired tons of talent from Google and other companies. This expertise helped Facebook not only keep up with scale, but add new features. Just today the QA team at Facebook shipped a cool new feature.
In Silicon Valley company managers, investors, and others have noticed these two things and are actively betting against both. This will make it tough for Microsoft to get its cloud computing strategy to work and will be tough for tech companies (and money) to locate in Los Angeles. It wasn’t lost on me that yesterday when I was at Y Combinator several of the folks involved there bragged that Ashton Kutcher visited the headquarters a few weeks ago.
I remember back when I worked at Microsoft that folks in the evangelism department bragged that they got MySpace to switch to Microsoft technologies like ASP.NET (MySpace used to be on ColdFusion which was an even worse technology bet and was creaking all over the place). Facebook, meanwhile, had made bets on LAMP (Linux, Apache, MySQL, PHP) and that let them hire quicker and find people who knew how to scale that stuff up big time.
Interesting lessons to watch. What decisions has your company made to accelerate innovation or doom it?