Based on recent comScore figures, Facebook attracted 161.1 million unique visitors worldwide in September, compared with 117.9 million for MySpace.

Facebook’s figures reflect a jump of 4.7 percent from the 153.9 million people who visited the social network in August. MySpace’s results reflect a decline of 1.6 percent from the 119.8 million visitors it received in August.

The global gap between the two social networks is now 43.2 million visitors. In the U.S. Facebook had 41.4 million unique visitors in September, while MySpace had 73.0 million visitors.

Source: Erick Schonfeld, “Facebook Widens The Gap With MySpace Internationally”, TechCrunch, October 29, 2008

According to TechCrunch, Facebook may become a victim of its own success. With a 118 percent in growth in unique million visitors - from 74 million unique visitors per month a year ago to 161 million uniques per month now (according to comScore) - the company is still not profitable. Which means it may need a substantial cash injection sooner rather than later to continue.

TechCrunch reports that with 750 employees and an estimated $10 million monthly payroll, along with $1 million per month for electricity, $500,000 per month for bandwidth, up to $2 million for each NetApp 3070 storage system it’s buying on a weekly basis, $15 million per year in office and data center rent payments, and $100 million earmarked for 50,000 servers… it all adds up to annual expenses of $200 million or more.

And while Facebook’s 2008 estimated revenue is $265 million, the company is still losing money at current revenues, with no assurance that revenue growth will meet or exceed the growth in costs.

Writes Michael Arrington:

“If revenues don’t grow substantially, the company’s runway of cash gets much shorter. 2008 revenues are likely $100 million less than the company anticipated a year ago. If the economic train really derails, Facebook could be in big trouble.”

If Facebook has spent most of the $500 million it has raised to date… and revenues don’t substantially increase… the company will need further funding. Which, according to Michael Arrington, it should grab as soon as possible.

Source: Michael Arrington, “Facebook May Be Growing Too Fast. And Hitting The Capital Markets Again”, TechCrunch, October 31, 2008

Erik Qualman has written an interesting article in Search Engine Watch. He has compared the Internet activities of each of the United States’ presidential candidates, Senator Barack Obama and Senator John McCain, focusing on five key areas. He deems Obama as the overall online winner:

1. Website traffic (Obama is the winner): Obama’s site receives 5.5 million unique visitors, while John McCain’s site receives 3.1 million (based on Compete data).

2. Social media (Obama): Obama has over 2 million fans on Facebook, while McCain has just under 600,000.

3. Paid search (McCain): McCain has higher listings than Obama on key search terms.

4. Organic search (tie): while, for every one search for ‘McCain’ there are 2.2 searches for ‘Obama’… there are even more searches for ‘Palin’ (Republican vice-presidential candidate, Governor Sarah Palin) than Obama. In fact, there are more searches for McCain and Palin combined, compared with Obama and Biden (Democratic vice-presidential candidate, Senator Joe Biden) combined.

5. YouTube (Obama): Obama’s YouTube channel has 100,000 subscribers and his videos have been viewed 17.1 million times. John McCain’s YouTube channel has 24,000 subscribers and has been viewed just 11.1 million times.

How any of this translates into actual votes remains to be seen… but not too long to go now!

Source: Erik Qualman, “Obama is Winning the Internet War”, Search Engine Watch, October 16, 2008

Mahalo, the editor-driven-search-engine-and-wiki-all-in-one founded by Jason Calacanis has laid off just under 10 percent of its staff. It has also cut other expenses and made other changes in an effort to give ‘Mahalo another year of ‘dry power’ (or runway) to complete our mission.’

Writing about the cost-cutting measures in his blog on Wednesday, Jason said the cuts were based on the challenging economic environment, and his view that the advertising climate will be severely depressed for the next two years.

He said that although Mahalo had a significant amount of cash on hand (presumably a lot of the $20 million the company originally raised), and was ahead of schedule in terms of traffic with 4 million unique visitors per a month, the measures would allow the company to operate past 2012 even if it never made any advertising revenue.

According to Silicon Alley Insider, Jason wants Mahalo to be generating 10 million to 15 million unique visitors per month before it sells ad inventory.

While Jason said 10 percent of Mahalo’s workforce were let loose, a former employee told Silicon Alley Insider that 11 of Mahalo’s editorial staff and two developers were laid off, with some of the positions to be rehired in the Philippines.

Silicon Alley Insider calculated this to be a third – not ten percent – of Mahalo’s staff. Evidently the variation is based on a misunderstanding of how many staff Mahalo actually has. According to Jason Calacanis, post-layoffs, the company will have 70 permanent staff, as well freelancers.

Sources: Jason Calacanis, “Tough times, hard decisions”, Calacanis.com, October 22, 2008, Nicholas Carlson, “Jason Calacanis’ Mahalo Fires People”, Silicon Alley Insider, October 22, 2008

True story: back in 1999, at the height of the dotcom boom, my husband and I had an idea for a review site that would be accessible via both the web and mobile phones. It would be a site where anyone could review and rank any kind of product or service.

This was just one of many ideas we had - being typical entrepreneurs we were full of them - and it was a heady time when anything seemed possible. The only problem was that we were already flat-out building our first Internet startup (an Internet security company) and had no time to pursue anything else.

Fast-forward to today and review sites seem to be everywhere, as highlighted by a recent article in The New York Times. While the author, Randall Stross, worries about anonymous, unqualified or biased reviewers on many of these sites (like book authors using pseudonyms to post favorable reviews about their own books), he seems enamored by one of the most popular review sites: Yelp.

According to Mr Stross, Yelp reviewers take a more professional approach to their work. Indeed, Yelp reviewers who consistently produce quality, amusing, well-considered reviews are rewarded for doing so by being appointed to the ‘Yelp Elite Squad’. Stross also like the fact that reviewers are also subject to Yelp member scrutiny.

There are plenty of other review sites. Actually, there are plenty of product review sites that don’t really offer genuine reviews but, rather, exist primarily to sell affiliate products or generate Google Adsense clicks. Such sites primarily aim to drive visitors to click on an ad or affiliate link rather than fully educate them about a given product or service.

That’s NOT to say there are no sites with an affiliate or Adsense based business model that offer objective, thoughtful, helpful product reviews. Some do. They just appear to be in the minority.

Meanwhile, the popularity of Yelp – which, according to comScore data, attracted 4.76 million unique visitors in July 2008 - indicates that despite the appeal of ‘peer’ reviews, and despite the proliferation of all kinds of review sites, people are eager for objective advice from authoritative, trustworthy sources.

‘Authoritative’ and ‘trustworthy’ doesn’t necessarily mean ‘professional reviewer’ but it may mean someone who appears to be credible and objective.

Like most things, winners and losers will emerge from among all these review sites. It’s sites that can make money whilst providing genuine value to their visitors or customers that are likely to be the winners.

Source: Randall Stross, “How Many Reviewers Should Be in the Kitchen?”, The New York Times, September 7, 2008

Technorati has acquired Blogcritics, a 6 year old blog network that allows numerous people to contribute articles to the site.

TechCrunch estimates that Technorati probably paid around $1 million to acquire BlogCritics. BlogCritics has around 73,000 articles from some 2,300 authors and attracts about 1 million unique visitors and 3-4 million page views per month.

Source: Michael Arrington, “Technorati Acquires BlogCritics, Gets Into Content Game”, TechCrunch, August 26, 2008

According to Nielsen, the gold goes to… Yahoo. Averaging 4.7 million unique visitors a day through August 18, Yahoo edged out the official U.S. Olympics broadcaster, NBC, with an average of 4.3 million uniques per day.

The third-ranked site, AOL’s Olympics section, had 1.3 million visitors a day.

Of course, we can’t rule out a last-minute rally from NBC since the results for the days following August 18 aren’t in yet…

Source: Brian Stelter, “Web Audience for Games Soars for NBC and Yahoo”, The New York Times, August 25, 2008

According to comScore, Facebook is not only the world’s biggest social network with 132 million unique visitors in June, but is also the fastest growing, with visitor growth up 153 percent over the number of unique visitors in June last year.

The major social networks, Facebook, MySpace, Hi5, Friendster, Orkut, Bebo and Skyrock, together reached 580 million unique visitors in June, up from 464 million June 2008, an increase of 25 percent year-on-year.

On a regional basis, the high growth areas were: the Middle East and Africa, with 66 percent more users in June 2008 compared with June 2007; Europe with 35 percent more users; and Latin America, with 33 percent more users.

Growth is still strong in Asia Pacific with 23 percent growth, but is flattening out in North America, where the number of users was just 9 percent more than those in June 2007.

After Facebook, the second biggest gainer was Hi5, which saw its June 2008 unique visitors soar by 100 percent over the number of visitors in June 2007. The largest social network in the United States, MySpace, grew only 3 percent worldwide - from 114 million unique visitors in June 2007 to 117 million in June 2008.

Where is Facebook’s growth coming from? Well, it’s seeing incredible growth everywhere, but particularly in Latin America where its June unique visitor count was 1,055 percent more than that in June 2007. It’s second highest growth (458 percent) was in Asia Pacific, while it’s lowest growth in unique visitors was in North America with a still decent 38 percent rise.

Huge growth rates are typically associated with a company entering new markets, which is largely why Facebook’s growth in various regions is so high. However, the sheer number of Facebook users is mighty impressive.

Sources: Nathania Johnson, “Facebook and Hi5 Lead Global Growth Among Social Networks”, Search Engine Watch, August 12, 2008, Erick Schonfeld, “Facebook Is Not Only The World’s Largest Social Network, It Is Also The Fastest Growing”, Tech Crunch, August 12, 2008

Imeem, apparently the third most popular social networking site in the United States after MySpace and Facebook, is also the most popular streaming music site.

Read Write Web reports that Imeem has licensing deals with the four major record labels (EMI, Universal, Sony and Warner Music), 80 percent of the independent record labels, and with Viacom to show videos from Comedy Central, MTV and VH1.

Imeem faces growing competition from CBS owned Last.fm and also from News Corp.’s MySpace, which will launch MySpace Music next month. Imeem had 27.7 million unique visitors in June and currently enlists around 65,000 new users each day. The company claims to have more than 85 million total unique users of its widgets. All very good… although MySpace has an estimated 120 million users.

Of course, the question for Imeem is… can it make money? It evidently commands a CPM (cost per thousand) of $4 per page, which may be insufficient to pay the record labels and still make money.

And the question for marketers intending to advertise on Imeem is… can it make THEM money? The search for ROI-positive advertising on social networks continues… Oops, I forget, it’s all about branding…

Incidentally, I created my Imeem page today: http://www.imeem.com/annaj… (I know, I know, it’s incomplete… but check out my playlist for what I listened to when writing today’s newsletter!)

Sources: Richard MacManus, “Imeem Taking Off - Before MySpace Music Has Even Launched”, Read Write Web, August 11, 2008, Anastasia Ustinova, “Music site Imeem dials up volume of traffic”, SFGate, August 11, 2008

While classified advertising revenues at newspapers are in decline, they’re booming online.

Makes sense - local advertisers are moving their ads to where their prospects are. And such prospects are spending less time reading newspapers and more time online.

Case in point: leading classifieds site, Craigslist. Craigslist CEO Jim Buckmaster recently said that in June housing ads on Craigslist were up 85 percent over those in June last year, while rental ads were up 120 percent year-on-year, and real estate ads as a whole were up 70 percent year-on-year.

Craigslist receives around 50 million unique visitors and 12 billion page views per month. Not bad for a service that began in 2000 with one PC running Linux, handling 6 million page views per month.

Sources: Michael Learmonth, “Craigslist CEO: Our Real Estate Listings Are Booming”, Silicon Alley Insider, July 25, 2007