MySpace boasts an American audience of close to 73 million. (Facebook counts 36 million). According to comScore, worldwide, Facebook tied the former, averaging almost 115 million users for each website for the first time in April. Also, users spend hours on the websites, making them a vital platform for advertisers.

Because MySpace still commands a majority of the money that is spent on social networking, it is perceived as a bellwether for the growing networking arena. However, president and chief operating officer (the News Corporation) Peter Chernin recently toned down the expectations for social networking ads, acknowledging the fact that selling spots on personal profiles as well as group pages is not that easy. According to him, social networking is an ‘entirely new form of Internet activity’. This makes the task even more challenging.

When Fox Interactive Media, MySpace’s parent, announced an ambitious three-year advertising pact with Google, worth $900 million in 2006, analysts claimed that social networking would become a major new revenue stream. However, while the Web is getting more social, it is becoming tough to wring profits from it.