APRIL 13, 2010 • If social networking worked from the same terminology as major league sports, 2010 would be a rebuilding year for MySpace. While the site was a dominant early leader, 2009 saw MySpace knocked down in the rankings by Facebook and a plethora of new social networking options appealing to mobile-centric youth.

In DFC’s own survey of gamers in North America, out of 1,600 respondents, 66% said they had used Facebook and 61% of respondents had used MySpace.  But of those that had used it, 41% said they no longer used MySpace versus only 13% that said they no longer used Facebook.

Results like that led us to talk with MySpace co-president Mike Jones about how the social network plans to win back market share. As is no surprise to readers of this publications, games will play a big part in the MySpace’s strategy.

DFC: So give us the big picture overview of MySpace today.  What are your primary products? How many employees do you have?  How many users do you have?

MJ: Our strategy is to build product that enables people to discover things they are interested in (like we did in music), and replicate that success in games, movies, and mobile.

MySpace drives discovery in the purest sense – a creator can connect with a fan, a user can discover a cool new video, two people with similar interests can meet for the first time, or an advertiser can reach the right consumer. It’s a place to broadcast messages, share experiences, or set a cultural agenda. If you’re a fan, a follower, if you want to find the latest trends – MySpace is for you.

We currently have more than 100 million users engaging with the site each month.

DFC: It’s been said that one of MySpace’s advantages that you want to build on is introducing users to new content. Please elaborate on that.

MJ: Everything we do enables discovery. For example:

• We connect people around their interests and passions, helping them meet new friends who enjoy similar things in areas such as music, art, games, etc.

• We provide the tools for users to create, customize, and manage their digital persona(s).

•  We continue expanding tools for artists to build out their fan base and manage their presence.

•  We deliver “live” and highly personalized experiences using push technology to enable real-time discovery and consumption of your personal interests

• We offer next generation mobile experiences: MySpace will leverage new mobile behaviors to offer many innovative social experiences to its users.

• We’re creating a visually rich interface with site upgrades and new product launches.

DFC: How important is social gaming to the success of social networking and what are your plans in that area?

MJ: Gaming is core to the overall entertainment value of MySpace. Just as music was our springboard for revitalizing our platform, we’re taking a similar approach to gaming which you’ll see in the new gaming experience we launched at GDC. As we’ve updated the platform, we’ve focused on increasing its recommendations and viral capabilities to drive visibility and engagement with games.

Recently at the Games Developer Conference (GDC) in San Francisco, we announced a new MySpace Games experience that creates a more social gaming environment with new tools and functionality for users and developers. The site, available at www.myspace.com/games, offers users discovery and sharing of games in a simpler and cleaner experience, as well as improved application engagement and analytics tools for developers on the MySpace Developer Platform.

We also announced a MySpace Games iPhone app and nine new social games.

DFC: Social networking sites are drawing huge numbers of visitors worldwide, yet only attracting 5.5% of all online ad revenue, according to several sources. When will advertising catch up to the growing audience, and what do services like MySpace have to do to attract more ad sales?

MJ: One advantage MySpace has over other social networks is that content matters with us – we are not just a communications platform.  This provides a richer environment for marketers to seed their story and there are unique “ad containers” that enable this connection. We’re focused on building new ad products, programming and experiences to help advertisers make a connection with the MySpace audience in a high-impact/high-comfort way.

For example, MySpace partnered with Endemol to create “Married on MySpace” – an original web series that offered one lucky couple the chance to win the wedding of their dreams in exchange for letting the MySpace community plan and experience their big day first hand. Major brands like JC Penney and Touchstone Pictures’ The Proposal were not only featured but thoroughly integrated into several of the episodes creating a seamless and unobtrusive viewer experience. With 15 million views, more than one million votes and 350,000 friends, the series was so well received that we launched season two in early March.

DFC: You have been in a co-leadership position at MySpace with Jason Hirschhorn for two months now.  How do you both break down your responsibilities?

MJ: Jason and I are partners – we share the same office, we understand each other and respect each other, and we’re honestly proud to be leading the incredible talent at MySpace.

I oversee Tech, Legal, Human Resources, Finance, Business Development, Music, Sales, and International. Jason heads up Product, Marketing, Public Relations, Customer Care, Safety, Security and Privacy.

DFC: Although MySpace has historically drawn many younger users, many of them have migrated to other social networks in recent years.  To attract more youthful users moving forward you have indicated that MySpace will add enhanced music content. What research showed that additional music content will be a successful draw for this demographic when they seem enamored with their mobile devices than computers?  And do you intend to aggressively push this new content via MySpace mobile apps?

MJ: MySpace users are inherently mobile. As you mention, our demo skews younger and many are increasingly using mobile devices – in fact, we’ve found that more than 50% of MySpace users use an iPod Touch or PSP.

Our goal is to create a seamless experience across the web, regardless of which device people use to access MySpace.  As we continue rolling out enhancements to the mobile platform, you’ll see a more aggressive push to promote entertainment content via MySpace apps.

DFC: In a recent DFC survey of gamers in North America, we found that a large number of respondents had used both Facebook and MySpace.  But of those that had used it a significant portion said they no longer used MySpace, while only 13% said they no longer used Facebook.  Do you feel this is indicative of a trend in the marketplace?  How do you focus on retaining users?

MJ: We’re committed to creating a next-generation experience for our users, who want more than anything else to be entertained through discovery. There’s something for everyone on MySpace but we’re focused on building a product that enables people to discover great content – like we did in music – and gives artists of all kinds the tools to help them get discovered.

People use multiple social networking sites to fill very different needs. Our total number of unique monthly visitors was up in both January and February of this year, reaching the highest growth in 6 months. Just last month, it was up 9.4% – 6 million uniques –  from Nov. 2009. We expect to see continued growth as we introduce new products to the site in the coming months. As far as retaining users, we’re all about consistently offering features and content tied to a person’s passion for entertainment – this naturally creates a reason to come back to the site.

DFC: In Brazil, research is showing Zynga games like FarmVille have become very popular with Facebook users, and that games in general are one of the main reasons users come back to the service. Similarly, Zynga’s MafiaWars is one of the top games on MySpace. Are you finding games are a significant user draw for you in emerging markets, and if so, how are you exploiting this opportunity?

MJ: Yes, games are a significant draw among our users. Our gaming engagement is up due to strategic investments in the developer community. We are committed to this group and provide them with strong promotional and analytics tools, as well as monetization solutions, establishing MySpace as the best destination for introducing new games to an active group of game players on the Web today.

DFC: Are you doing enough to promote games on MySpace?  Where do you see games fitting into your long-term strategy?

MJ: Gaming is a core focus for the overall MySpace entertainment platform, along with music, movies, TV, fashion, and sports. With the new MySpace Games experience, we’re providing a platform that is simple and friendly to independent game developers, while giving robust support for premium games from major development houses. This results in more gaming choices for users and developers alike.

For developers, the new experience is a step to improve application engagement and as games will be merchandised in more areas, games can be shared more easily by users, and deeper analytics tools provide more insight into how games are being used and by which demographics.

The APIs we announced at GDC allow MySpace Platform developers to:

• Review application-specific analytics via a new API, including invitation conversions, active users, notification responses and demographics.

• Build games in rich, 3D-like quality with Unity’s powerful 3D engine and allow MySpace users to access the games with a new plug-in. For example, Paradise Paintball utilizes this technology.

• Encourage cross-platform competition with Scoreloop, which allows games on different platforms to share the same high scores, achievements, challenges and buddy lists.

• Utilize GroovyCortex, which is a cloud-based solution for onsite application developers, to provide low latency push data for multiplayer games.

• Track the source of application invitations and utilization to learn how users are finding and choosing specific games.

DFC: How does MySpace plan to monetize products like games?  Is it mainly just a way to get users engaged and on the site, or do you see revenue potential from the ability to sell things like virtual goods?

MJ: We are committed to a monetization strategy for developers on our site.  Developers can monetize their games and keep 100% of the revenue.

We are testing new ways of partnering with game developers to drive engagement for our users and revenue for both the developers and MySpace, while surfacing fresh content for our users.

Games are an engagement driver for us; the average game player spends 2 times longer on MySpace than non-game players.

DFC: What is your strategy for expanding in emerging markets? What countries are next on your launch list?

MJ: A good percentage of our traffic comes from our international territories – particularly in the music category, where we’ve seen great success in the U.K., German, and Australian markets so far. At this time, we don’t have further geographic expansion plans to share but will keep you updated.

DFC:  How does being part of News Corp., and its huge storehouse of content, make your life easier?

MJ: We have a strong relationship with News Corp. They have been an incredible partner to MySpace, investing heavily into the business and they very much wish us to succeed.  Because we’re a part of News Corp., we also have assets and relationships in the entertainment space that are unrivaled, including exclusive opportunities to complement hit TV programs, such as Glee, American Idol, If I can Dream, America’s Got Talent, with highly-integrated and engaging online campaigns.

We plan to continue to leverage those assets in a meaningful and unique way, and we believe that will help differentiate us and help the brand reinforce that our strengths lie beyond just music.

DFC: Tell us more about your partnership with Microsoft and MySpace’s integration into Outlook Social Connector.  How does this integration work, how will MySpace appear to Outlook users, and how does this integration benefit you in the long run?

MJ: Using Microsoft’s Outlook Social Connector software, MySpace for Outlook is a plug-in that enables people to view MySpace user activity and contact information within Outlook. More specifically, it allows users to:

• View MySpace friend activity updates in Outlook – The activity updates can be seen every time you open a friend’s email or the MySpace Contacts List.

• Create a special MySpace Contact List, bringing all of your MySpace friend info into one convenient location.

• Utilize the new Outlook Social Connector “People Pane,” which shows friend activity and status updates.

• Access hyperlinks in the activity updates, allowing you to quickly jump to see various activities, such as posting a new picture, recording a new video, recording a new song, or making a new friend.