MySpace to follow rival's lead
MySpace is likely to change its technology strategy to allow other online companies to "plug" their web services directly into its social networking site, according to Chris DeWolfe, one of its founders. — The move would mark a new step in the evolution …
Context & Ripple Effects
MySpace has spent 2007 bolting new services onto its own walls: a news aggregation feature launched in March (MySpace News), and two days before this report it upgraded its video tools explicitly to chase YouTube, whose rise grew out of users pasting clips into MySpace profiles (its video upgrade). The same month it closed a $250-$300 million deal for Photobucket, with a rumored bid for widget maker Flektor alongside it — buying the embeddable content that already lived on its pages.
What DeWolfe now signals is the inverse move: rather than acquiring every widget maker, MySpace would let outside companies plug their services straight into the site, following the rival that pioneered the open-platform playbook earlier this year. For a News Corporation division under pressure on both product pace and safety scrutiny — eight state attorneys general demanded sex-offender profile data in May, and privacy commitments are being tested in court — opening up changes what it must control.
First-order effects
- Third-party web services gain direct access to millions of MySpace profile pages without needing to be acquired first — the Photobucket-and-Flektor shopping spree becomes one route among several rather than the only path to distribution.
- MySpace's engineering priorities shift from building features in-house (video upgrades, MySpace News) to policing and hosting other companies' code on its pages.
Second-order effects
- The rival that set the platform template gets its move answered, pushing competition from feature-by-feature copying toward whoever attracts more third-party developers faster.
- Every embedded service becomes new advertising surface and new privacy exposure at once — a site already answering to state attorneys general must extend its friend-only privacy assurances to applications it did not build.
Third-order effects
- If the pattern holds, social networks stop competing as destinations and start competing as platforms, with the moat moving from proprietary features to the size of the developer ecosystem a network can attract.
- Platform openness makes regulators' and litigants' privacy demands apply to an entire app ecosystem rather than one company's own pages, raising the compliance bar for every network that follows.
The trend: Social networks are recomposing their moats from walled-garden features to open developer platforms, trading control of the page for scale of distribution.