Can MySpace Steal Google Users?

    April 11, 2007

Could MySpace really attract a large proportion of users away from Google and other major portals? A new report from JupiterResearch "21st Century Portals: Thriving in the Google-MySpace Era" examines that question.

The report says that 55 percent of the users who are most likely to pay for services could be drawn to an entertainment and communication combination such as MySpace.

"Right now, portals like Yahoo, AOL, and MSN dominate online usage and, together with Google, collect 55% of US online ad spending," reported David Card of Jupiter. "For a long-tail market, the Internet is pretty concentrated at the head."

The American Consumer Satisfaction Index found that U.S. consumers were more satisfied with Google than Yahoo, AOL or MSN. It also revealed they had more satisfaction with all portals excluding those three.

The most visited subdomains within each portal shed light on the most popular features. For AOL its instant messaging, and for MSN and Yahoo its email. If the definition of a portal is a gate opening to another place, Google is more of a pure portal than the three large sites, according to Quantcast.

While email use increases portal traffic so does instant messaging. Frequent Internet users are more likely to use IM than social networks, podcasts or RSS feeds, according to a Universal McCann study done with Insight Express.

Video has become an important competitive differentiator among the portals. The video sections of the major portals are major destinations for U.S. Internet users to watch video content according to Piper Jaffray. YouTube, TV network sites and Google video top the list for video destinations.

eMarketer Senior Analyst David Hallerman notes that even MySpace’s wealth of entertainment content doesn’t count the portals out on this front.

"As long as the portals can deliver a fair cut of advertising revenue," said Mr. Hallerman, "TV networks and movie studios will likely be willing to license at least some of their content. Monetizing such content is not always easy, and in this case the broad reach of the portals can make a key difference."