Submission + - Social networking: Lots of buzz, little revenue (computerworld.com)
Ian Lamont writes: "MySpace, YouTube, and other websites that incorporate social networking features may be generating a lot of buzz, but they are not generating a lot of revenue, according to an IDC report cited in Computerworld. The reasons include a lack of precise demographic information for advertisers, and the desire for an "environment that doesn't threaten the safety of a company's brand." A potential solution for YouTube, says IDC, is to set up distribution deals with big media conglomerates, but that may not fly either:
These issues haven't stopped some observers from predicting huge revenue streams for social networking sites, such as Henry Blodget, who sees Facebook hitting a "$1 billion run-rate within a year"."YouTube, the report suggests, could earn substantial advertising revenue if it could figure out a way to acquire premium content from distribution deals with companies like Viacom Inc., NBC and Walt Disney Co. However, the report noted that Google so far declines to pay the sums required to purchase the content.