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Community 2.0

Alex PastelFranco Guadarrama

Social Networks and Revenue

Introduction

What is a social networking community? An interactive, user-submitted network of

friends, personal profiles, blogs, groups, and music

Additional features: ability to create groups that share common interests or affiliations, upload videos, and hold discussions in forums.

Most of these sites are free to use How do they make money then?

MySpace

Founded in 2003 by a tiny, computer-savvy group of individuals in California.

Began to make money by selling ad banners strategically placed atop every page.

Bulk of users are seventeen to thirty-five, the most highly desired demographic for advertisers.

Key to monetizing MySpace is by selling sponsored search results.

Social search can be sold to a social network by using the profile information of the hundred million people in MySpace to influence a search.

Facebook

Originally developed for college and university students.

Has since been made available to anyone to join.

Largest number of registered users with over 17 million members worldwide.

Only allows plain text and minor customization features to retain a consistent look.

Free to users and generates revenue from advertising including banner ads and sponsored groups.

Xanga

Free Web-based service, hosts weblogs, photoblogs, videoblogs, audioblogs, and social networking profiles.

Customize how Xanga looks using pre-made templates or custom HTML designs.

Commonly used as personal journals Largely supported by advertising; banner ads that appear on the top of most pages.

Offers two levels of premium subscriptions: Premium and Premium Plus.

Receive bonus features: additional photo storage and monthly uploads.

Summary

Offer an interactive, user-submitted network of friends, personal profiles, blogs, groups, photos, music and videos.

All three of these Community 2.0 companies use ads to generate the majority of their revenue.

Usually run by a small handful of people; minimal operating expenses.

Massive user-base allows for multi-million dollar profits

Business Model

Combine revenue generating techniques of MySpace, Facebook, and Xanga

Take advantage of massive user-base to monetize

Social search, sell flyers and gifts, offer premium subscriptions

Allow some use of HTML for customization, but try to keep the site clean

Thank You

Community 2.0

Alex PastelFranco Guadarrama