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Making MySpace into ad space

A woman looks at the MySpace website.

TEXT OF STORY

KAI RYSSDAL: Here it is only Tuesday and it feels like there's been a week's-worth of news from big media companies. Time Warner CEO Richard Parsons said today he's going to take a hard look at whether it makes sense to sell off his struggling Internet company AOL. We learned late last night The New York Times has given up on making people pay to read some of its content online. And Rupert Murdoch's News Corp says its figured out how to customize ads on its Internet company, MySpace. We asked Marketplace's Lisa Napoli to find the common thread here.


Lisa Napoli: MySpace is a place where millions of people bare their souls, not to mention what kinds of things they like and dislike. That makes it a potential bonanza for marketers who can easily figure out how to sell what to whom.

Now, they haven't done that on the social networking site until now, but News Corp is saying that this week, it'll unveil the technology so they can. University of Southern California marketing professor Ken Wilbur says it's about time. After all, he says, News Corp didn't pay $770 million for MySpace a couple years ago for nothing.

Ken Wilbur: For years, every time I go on MySpace, I see ads for dating services. But I'm a happily married guy. So, I would love to see ads for things that I might be interested. Like, what movies are coming out this weekend.

USC's Wilbur says with online advertising growing 26 percent this year over last, it's obvious why big-deal media companies like News Corp. and AOL's Time Warner would be scrambling to figure out how to make a buck. And the beauty of the Internet is that it allows you to customize in ways that haven't been possible before.

That efficiency spooks people like Jeff Chester of the Center for Digital Democracy.

Jeff Chester: It's a very powerful and intrusive system. You're talking about the continual collection of personal information. But we have to have some basic rules.

Chester says the rules are just playing themselves out as the online medium matures and people are able to do more on the Internet, like watch video. He says one thing seems conclusive from the failed New York Times attempt to charge for some of its content: People want what they get online to be free. They'll just have to wade through the ads now in order to get it.

I'm Lisa Napoli for Marketplace.

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