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MySpace.com:Structuring The Network

Presented By: Brian DennettPrepared by: Antony Abara, Brian Dennett, Wayne Marcy, and Vivek Patel

Structuring the Network

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Overview of MySpace

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MySpace.com is the largest social networking site

130 million users growing at 250k a day

Accounts for 17% of the all Internet ad impressions

Projected 250 million in revenue for 2006

Content is Largely Unstructured and Unclassified Only members can be targeted Targeting capabilities are limited to information provided by members

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Opportunity

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MySpace.com CPM rates are low by industry standards

MySpace.com has the potential to have dramatically higher CPM rates

To realize higher CPM rates, knowledge must be collected about MySpace.com traffic

The REULE Targeting Engine will allow MySpace.com to obtain more than 2 Billion dollars total revenue by 2011 an increase of 500 Million.

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Potential Customer List GM

2007 Internet budget up to 3.5% to 150 Million

Wal-Mart 2007 Internet budget 35 Million

Circuit City 50 Million 2005 spending

Absolut Vodka 2007 20% of Marketing budget online

Limited Brands VictoriaSecret.com, Bed Bath and Body Works, Limited Clothing Store 14 Million online 2005

Vonage 275K Internet spending in 2005

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Ad Type  BANNERMEDIUM

RECTANGLELEADER BOARD

HALF PAGE

SKYSCRAPERGROUP

SECTIONMUSIC

SECTIONVIDEO CLIPS

FEATURED PROFILE

 Size 468x60 300x300 728x90 430x600 160x600        

Current Price CPM

$5.00 $5.00 $4.00 $6.00 $4.00 $3.00 $7.00 $20.00 $50,000.00

Projected Price after 12% CPM increase

$5.60 $5.60 $4.48 $6.72 $4.48 $3.36 $7.84 $22.40 $56,000.00

Financial DetailsProposed Pricing Model

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Structuring the Network

Revenue (Flat) Projected Revenue Increase From Reule Targeting2006 $250,000,000.00 $250,000,000.00 $0.002007 $250,000,000.00 $280,000,000.00 $30,000,000.002008 $250,000,000.00 $313,600,000.00 $63,600,000.002009 $250,000,000.00 $351,232,000.00 $101,232,000.002010 $250,000,000.00 $393,379,840.00 $143,379,840.002011 $250,000,000.00 $440,585,420.80 $190,585,420.80

Accumulated Total Revenue $1,500,000,000.00 $2,028,797,260.80 $528,797,260.80

Financial Details (continued) Projected Revenue based on annual increase of 12%

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Structuring the Network

Hardware

Development Environment (Web server, Core and DB)

QA Environment (Web server, Core and DB)

Stage Environment (Web server, Core and DB)

Production Environment (Total)

*High-Availability half-terabyte DB *Data miner

*Reporting server Total

Quantity 1 1 1 1 2 2 1Cost $33,000.00 $33,000.00 $33,000.00 $103,000.00 $70,000.00 $22,000.00 $11,000.00 $202,000.00

ContractsOutsource QA to India QuantCast Total

Quantity 1 1

Cost $100,000.00 $0.00 $100,000.00

Total Start-Up costs: $1,532,000.00Note: * - Part of Production Environment

StaffProject Manager

Senior Engineer DBA

Lead Developer Developer Data steward

MySpace Superstar Total

Quantity 1 1 1 1 4 2 2Cost $130,000.00 $110,000.00 $130,000.00 $120,000.00 $400,000.00 $180,000.00 $160,000.00 $1,230,000.00

Financial Details (continued) Costs

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Structuring the Network

Year cost revenue Increase Net IncreaseFixed 1-time

3% Royalty Staff2006 -$302,000.00 $0.00 -$1,230,000.00 $250,000,000.00 $0.00 -$1,532,000.002007 -$900,000.00 -$1,230,000.00 $280,000,000.00 $30,000,000.00 $27,870,000.002008 -$1,908,000.00 -$1,230,000.00 $313,600,000.00 $63,600,000.00 $60,462,000.002009 -$3,036,960.00 -$1,230,000.00 $351,232,000.00 $101,232,000.00 $96,965,040.002010 -$4,301,395.20 -$1,230,000.00 $393,379,840.00 $143,379,840.00 $137,848,444.802011 -$5,717,562.62 -$1,230,000.00 $440,585,420.80 $190,585,420.80 $183,637,858.18

Recurring

Cumulative Total -$302,000.00 -$15,863,917.82 -$7,380,000.00 $2,028,797,260.80 $528,797,260.80 $505,251,342.98

-$100,000,000.00

$0.00

$100,000,000.00

$200,000,000.00

$300,000,000.00

$400,000,000.00

$500,000,000.00

$600,000,000.00

2006 2007 2008 2009 2010 2011

cost

increase

Cummulative

Financial Details (continued)Return On Investment

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REULE Targeting Engine

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Workflow Overview

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The RUELE targeting engine will proceed under the following workflow:

MySpace.com websites are mined by the REULE Network Miners

Mined psychographic and demographic information about the website is stored in the REULE Database.

The REULE Targeting data is accessed by the data stewards and checked for accuracy

The Superstars of MySpace.com will further analyze the data and understand where Market niches can be established and targeted.

Superstar data is incorporated into the REULE reporting data to be accessed by the MySpace.com’s marketing team.

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Architectural Overview

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Target Audience

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Who? Identify our user-base Define audiences

Why? Decide who is marketable

How? Develop a way to find targeted users

Where? Track user traffic Discover hubs

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Risks Inaction

– What happens if no action is taken by FOX interactive media and MySpace.com?

Alienate Users

– What if too many untargeted solicitations de-sensitize users to MySpace.com advertising?

Competitive Advantage

– Does the REULE targeting engine offer the competitive advantage that MySpace.com will need to grow aggressively for the next five years?

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Next Steps Sign contracts Begin Work Payment Schedule

Payment 1 … $399,000.00 Payment 2 … $706,000.00 Payment 3 … $300,000.00(* See details in attached document)

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Questions and Answers

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The End

MySpace.com: Structuring the NetworkPresented By: Brian DennettPrepared by: Antony Abara, Brian Dennett, Wayne Marcy, and Vivek Patel

Structuring the Network