Getting into the MySpace Headspace

With all I have to do, updating another web page is, truly, about the last thing on my mind.

That doesn't mean I am anywhere close to the majority opinion on this. Today, an RBC analyst actually
predicted that a $15 billion market capitalization for News Corp.'s juggernaut MySpace in a few short years.

Per Reuters,

"RBC Capital analyst Jordan Rohan said he had come away from a meeting with Fox Interactive, the managers of MySpace, believing that 'media investors may not fully appreciate what has already been done with MySpace or what may lie ahead.' '$15 billion in a few years? It is possible,' Rohan wrote in a research note to clients.

Keep in mind how startling a number that truly is. The total market cap of all of News Corp. is currently "just" $63 billion. Naturally, we could expect News Corp. to grow, too, and there's no guarantee that this analyst wasn't high when he wrote the report, but it's still an astonishing, nearly ballistic growth rate for a company that was only worth half a billion a year ago.

It's easy to see why.

As TV Week noted today,

"MySpace.com ranks first among its peers in total video streams served with almost 1.5 billion, representing 20 percent of all videos streamed by Internet users, according to monthly figures released by comScore Media Metrix."

It almost seems quaint how Hollywood used to view websites like MySpace and YouTube. Initially the thinking was that they'd be places that would democratize media, with digital video tearing down the barriers to entry to Hollywood's clubby creative community.

But the effects have been far more startling. Now, in effect, these social networking sites aren't just producing new talents, they are becoming their own networks and competing with Hollywood.

For proof, look at today's news of yet another deal with a YouTube phenom:

Per Variety,

"Joe Bereta and Luke Barats, whose YouTube 'channel' is one of the viral video site's most popular, are making the jump into television, inking an overall deal with NBC Universal Television Studio...Barats and Bereta's comic video sketches have become a popular staple on YouTube, with their video 'channel' on the site ranked as the service's sixth most subscribed. Their most recent short, "Completely Uncalled For," generated more than 1 million views in its first five days of release."

The problem, of course, is that such online success on YouTube is a lose/lose proposition for both new talents and networks. If you're Luke or Joe, sure, everyone loves watching your stuff. But no one is paying you for it. If you're NBC, the time kids spend surfing YouTube is probably time not spent watching NBC shows.