Yesterday, MySpace’s parent (grandparent?) company, News Corp, discussed its Q3 earnings. While many of the conglomerate’s divisions did poorly, MySpace’s unit still posted a 17% increase in revenue YOY. However, they are feeling the hit of the failing economy, as Rupert Murdoch said:

“We are doing slightly better than the marketplace, but it’s clear from everybody else that there’s a lot of softening in the display advertising marketplace, and we are clearly beginning to feel some of that.”

However, their new ad platform, MySpace MyAds, is doing booming business. Michael Arrington’s sources estimate that the three-week-old platform is raking in on average $140,000 to $180,000 a day—making it a $50M a year business in less than a month. These levels may be sustainable long term, too.

Our sources say that a large number of ad arbitragers are trying out the system, as well as many of the millions of music artists that have MySpace pages. Those artist ads are doubly profitable for MySpace, since the ads link back to MySpace web pages, driving up page views and additional advertising impressions.

Outsiders are estimating that MySpace revenues for the fiscal year ending June 2009 will reach $1 billion. It’s clear that MyAds will be a significant driver of revenue growth. 2008 revenue was estimated to $750 million.

Finally, MySpace Music, which launched in September, is shopping for a CEO. AllThingD’s Peter Kafka notes, however, that the job doesn’t carry as much prestige as the title normally would, since it’s only a divisional CEO position. He says Courtney Holt, head of Viacom & MTV’s digital music, will be announced as the MySpace Music CEO tonight or tomorrow.

In the tech blogosphere, MySpace is often treat as if it’s “so yesterday”—now even its biggest challenger has lost its media darling status. But MySpace continues to innovate for users and advertisers—which probably has a lot to do with why they’re still the most popular social network online.

Comments

- Targeted reach – you can narrow your campaign to a specific audience of MySpace users, including gender, age range or geographic area based on the info that users provide on their profiles.

– Ease of use – You can get your campaign online in just a few simple steps using tools provided by MySpace.

– Spending Control – You can determine how much you want to spend on a campaign, anywhere between $25 and $10,000. You’re only charged when users click on your ads (CPC rates start at $0.25).

– Measurable Performance – you can track the performance of your ads and edit them, as well as adjust your spending.

The service initially seemed targeted toward musicians, as it surfaced near the launch of MySpace Music, and seemed a perfect way for bands to promote themselves even further with MySpace. While this is still true, MySpace has stressed that the service is really for everybody including "filmmakers, musicians, politicians, authors, video bloggers, non-profit orgs, realtors, restauranters, comedians, radio stations, and doctors," according to Mashable’s  Mark ‘Rizzn’ Hopkins, and backing up my suggestion for small businesses to take advantage of the program.

MyAds is similar to Facebook’s advertising offering, but Facebook only offers text ads whereas MySpace offers display ads only. Are these the answers the social network "big boys" have been looking for? Michael Arrington at TechCrunch writes:

The big social networks are still trying to find their “Google Moment” – the point when (and if) they find a way to monetize these massive audiences they’ve attracted. Google was just a great search engine until they matched it with contextual advertising. MySpace and Facebook need to find their own revenue engine.

Facebook will probably only generate $300 million or so in revenue this year. MySpace is ahead of them, with $850 million or so in revenue last year and a projected $1 billion in fiscal 2008 (which ends next June for them). But it’s still a far cry from what Google generates per unique monthly visitor.

I’m not going to say it’s the next AdSense, but I think MyAds will be pretty big for MySpace, and even bigger for its users. The ease-of-use that will allow "Joe MySpace-User" to design their own ads and target them at cheap rates is going to appeal to a whole lot of people, particularly those who have had trouble getting Social Media Marketing to work for them.

The recent launch of MySpace Music should only help the social network grow as well, and that means potential target audiences for ads will grow right along with it, and with the sheer catalog MySpace Music offers, there will be no genre left out, leaving plenty of room for every demographic as long as they like music in any form. Let’s just hope advertisers can avoid the kind of insulting ads that Facebook members have been seeing based on that network’s ad personalization capabilities.