Liz - Profit in online social networks

The concept of how online social networks (MySpace, Facebook, etc) made money intrigued me. But it makes sense when you consider how many millions of members exist in all the different networks, thus advertising will pay big bucks for the exposure. MySpace's deal with Google was worth $900million over 3 yrs, .but it is through advertising that it makes the money. 2008 advertising profits were projected to be $700-800million! Pushing that even further is HyperTargeting, a software MySpace uses to steer advertisers towards its members according to those users' interests. Mobil ring tones and artist merchandise also bring in money - MySpace has deals w/some major record labels. Both Facebook and MySpace allow some profile sharing with select sites. MySpace allows sharing with Yahoo and eBay. I think this will make advertising on those site even more valuable (higher profit) because the sharing open doors to additional users.

Here is the link to a USA Today article:
http://www.usatoday.com/tech/techinvestor/industry/2008-05-11-social-networking_N.htm