SIMON AVERY
From Monday's Globe and Mail Last updated on Tuesday, Mar. 31, 2009 10:50PM EDT
When the creators of MySpace decided to include Canada in their initial international expansion drive, they were hardly taking a huge risk.
The social networking website is one of the most popular places anywhere among Canadians, online or offline. Almost six million people visit the site each month, more than twice the number of people living in the country's largest city, and one-quarter of all Internet users in Canada.
MySpace began offering a Canadian version of the site in January, and officially launches it Monday at ca.myspace.com after four months of testing.
It is part of a huge international push for the largest of the Web's social networking sites that began shortly after News Corp. paid $580-million (U.S.) for the two-year-old company in 2005. In the past month, MySpace has begun venturing into China, Latin America and South America.
“Canada is more like the U.S. than other countries, but there are very, very distinct differences,” co-founder and chief executive officer Chris DeWolfe said in a phone interview from Los Angeles.
The Canadian site has been promoting Canadian bands, such as Juno Award winners Billy Talent, and local events, such as the North by Northeast Film Festival, which runs in Toronto next month. It has deals pending with Canadian comedians as well as with a Canadian wireless company to deliver MySpace to cellphones.
Some projects began in Canada and were then adopted by the main U.S. site.
“We basically started our whole comedy community on MySpace based on a comedy festival that we sponsored in Montreal last summer called the Just for Laughs comedy festival,” Mr. DeWolfe said.
Separate country sites aim to offer local content and “seamlessly blend the online with the offline world,” said Travis Katz, senior vice-president and general manager of international operations.
In March, News Corp. and NBC Universal announced a joint venture to let people watch their programming on MySpace, as well as on Time Warner Inc.'s AOL, Microsoft Corp.'s MSN and Yahoo Inc.'s web properties. The move is meant to counter the growing might of Google Inc.'s popular YouTube video site.
None of that new content, however, will reach Canadians online because licensing rights only cover U.S. audiences. Negotiating rights for a global audience remains an obstacle for MySpace, which could see international sites dealing in a second tier of content.
“What's interesting in the U.S. is not necessarily interesting to Canadians,” Mr. DeWolfe said. “But there definitely is a lot of carry-over content, and wherever and whenever possible we are trying to get global rights for the content. And if we can't get global rights to the content deals then we try to get joint U.S. and Canada rights.”
About 5.9 million Canadians spent an average of 83 minutes each on MySpace in March, said Bryan Segal of comScore Canada Inc., which measures Internet traffic. Remarkably, three other properties in the social networking category attracted even more Canadians. Microsoft Corp.'s Windows Live Spaces drew in 39 per cent of online Canadians, followed by Google's Blogger (29 per cent) and independently owned Facebook (28 per cent).
These four brands have virtually locked up the social networking space at this point, said John Ruffolo, national leader of the technology, media and telecom practice at Deloitte & Touche. But like many people watching the space, he questions how these massive audiences can be turned into profits.
“My big issue is – similar to in the late 1990s – you talk about all these eyeballs, but the jury is still out on whether any of it can make any money,” he said.
MySpace is experimenting with new ways to sell advertising, including inserting short video ads at the start of their members' videos, developing special communities that are branded by a single advertiser, and running contests where members upload testimonials for a product.
MySpace works with 80 per cent of the Fortune 500 companies and is already a major advertising venue for Hollywood films, Mr. DeWolfe said.
“Advertisers are hungry for alternative forms of advertising that are more effective than traditional forms.”
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