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Article

Title: Facebook, Riding a Web Trend, Flirts With a Big-Money Deal

Author: Delaney, Kevin J; Buckman, Rebecca; Guth, Robert A Article Type: Product Analysis
Source: Wall Street Journal, v248 n69 pA1(2) Publication Date: Sep 21, 2006
  ISSN: 0193-2241
  Illustrations: Graphs
URL of Publication: http://www.wsj.com

News Corp's MySpace is a cash machine now used by the company to promote music, movies, soft drinks, and books, assisted by such features as video downloading and instant messaging (IM). In August, Google assured MySpace and some other News Corp sites at least $900 million in ad revenues over the next three and a half years. Other companies that could have ambitions similar to those of News Corp, say those in the know, are Yahoo!, Microsoft, and Viacom, who might be wooing Facebook.com, another social-networking site. Technology companies seeking to expand their influence on the Internet are looking to social-networking sites that can serve as an entry point onto the Web, where an owner can sell access to all the consumers that come there. In the past, investors and marketers have sought out portals such as Yahoo! and Google, but there is risk in building a business around social networking sites such as Friendser, Bebo, and many smaller players, because their consumers may have a short attention span that leads to the demise of some of the sites. Based on online ad sales, Facebook is likely to surpass $100 million in annual revenue, and the company has not decided whether or not it will ever go public or be acquired, says founder Mark Zuckerberg. Facebook plans to permit anyone with a valid e-mail address to join. Some school-age people are now former social networkers, saying the sites have become too populated, are too popular, commercial, and like an unpleasantly loud party. Some say that Yahoo! was recently considering an offer of about $1 billion for the company, but rumor has it that 22-year-old Mr. Zuckerberg could not participate in the negotiations because his significant other was in town.

Special Features: Graphs

Companies:
Facebook Inc MySpace Inc
News Corp

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