Is Upwork Going to Pull a Myspace?by@nebojsaneshatodorovic
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Is Upwork Going to Pull a Myspace?

by Nebojsa "Nesha" TodorovicSeptember 13th, 2022
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MySpace was THE most popular, visited, and used social network in the world from 2005 to 2008. Justin Timberlake, who had one of the lead roles in a movie about Facebook, now owns MySpace. The site was the most visited website in the U.S. and the most visited by Google and Yahoo! Mail in 2006. MySpace lost $600M in six years and was sold to Specific Media for $35 million in 2011. All great empires fall from within, including the digital ones.
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Does anyone still remember MySpace?

Well, the story about MySpace should be told over and over again. Why? Because you can learn a lot from it.

To begin with, they made a movie about Facebook called “Social Network,” if I’m not mistaken. Now, if you’re asking me, they should’ve made a movie about the rise and fall of MySpace. That would’ve been one more interesting and far way more dramatic movie. The sweet irony is that Justin Timberlake, who had one of the lead roles in this movie, now owns MySpace. Who could have thought that would be possible? Maybe he got an idea to buy MySpace while participating in a movie about Facebook. I don’t know for sure. What I do know is that MySpace deserves a special place. Here’s why.

Oh Boy, Those Were the Days

Back in the day, from 2005 to 2008 MySpace was THE most popular, visited, and used social network in the world.

“By 2006, MySpace was being visited more times than Google Search and Yahoo! Mail, becoming the most visited website in the United States. In June of 2006, it was reported that MySpace was responsible for nearly 80 percent of all traffic-related to social networking sites.”

That’s something not only Facebook, but any other social network out there can only dream about. Who could have thought that it would be possible to lose $600M in six years? That’s precisely what happened to MySpace.

“News Corp bought the site for $580 million in 2005. The company eventually sold MySpace to Specific Media for $35 million in 2011.”

So, What Went Wrong and Why?

Any online platform with millions of users is a gigantic money-eating machine, plain and simple. Here’s what good old Wiki has to say about that:

“Marvin L. Gittelman suggested that the $900 million three-year advertisement deal with Google while being a short-term cash windfall, was a handicap in the long run. That deal required Myspace to place even more ads on its already heavily advertised space, which made the site slow, more difficult to use, and less flexible. Myspace could not experiment with its own site without forfeiting revenue, while rival Facebook was rolling out a new clean site design.”

Truth be told, things are a bit more complicated in MySpace’s case. You know what they say. All great empires fall from within, including the digital ones. The virus of decadence is alive and kicking. He obviously didn’t die out with the fall of the Roman Empire.

While MySpace was occupied with “the opening of extravagant new offices around the world, Facebook was working hard with the modest underdog budget. The rest is the shiny Facebook’s history and the new social networks world order.

“According to Businessweek, the pressure to drive revenue, when other startups were using the luxury of venture money to create and explore, stifled the possibility that MySpace would have the breathing room it needed to innovate. Instead, executives were focused on trying to raise advertising profits.”

What Does It Mean When Someone Says That You Are the Next MySpace?

When someone says that your startup, company, business, platform, or whatever is the next MySpace, you have to immediately stop what you’re doing and take a deep breath. It’s not a curse, but it’s a serious warning. This means that you’re already on the road to Mandalay, but you just don’t know it yet.

So, here I am and I am asking this question, my dear Upwork are you the next MySpace? Now, Upwork may reply, what are you talking about? We’re having the time of our freelance lives.

The trouble with Upwork, though, is that it just had its “MySpace Google advertising” moment when it made its NASDAQ debut. Meaning, that Upwork took the money, and now it has to live up to its investors’ expectations the same way MySpace had to satisfy Google’s advertising appetites. We know how that one turned out for MySpace. The pressure is going to be enormous and Upwork will have to be very creative in finding new ways to ensure liquidity. Here’s the problem.

Upwork already doubled its fees. That wasn’t enough. So, it had to go public. I’m afraid that’s not going to be enough too. Why? Feel free to check Upwork’s NASDAQ situation. While you’re reading this article, its shares are hitting a record low.

Punk Is Not Dead, Neither Is MySpace

MySpace is still alive, but it isn’t kicking, that’s for sure. The numbers never lie.

“Last November, the site got 50 million unique visitors in the U.S. That’s a lot of visitors for a site that most people haven’t thought about in 8 years. Facebook currently boasts 864 million daily active users worldwide.”

How do MySpacers feel about it? Well, here’s what they had to say to Business Insider:

“MySpace: Yes, Facebook Kills Our Traffic, But At Least We Make Money!”

Now, that’s a definition of a positive attitude. Steve McQueen had put it nicely in “The Magnificent Seven.”

It reminds me of that fellow back home that fell off a ten-story building. As he was falling people on each floor kept hearing him say, “So far, so good.”

Well, Upwork, so far, so good, but for how long?

Also published here.

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