Bubble bursts on Web 2.0 site membership claims

Is there anybody there?

The latest snapshot of teenagers' web surfing habits should further debunk sky-high valuations of, and membership clams by, popular social networking sites.

Barely half of US teenagers have used a social networking site while just over half, 55 per cent, own a profile on MySpace, Facebook or YouTube, according to the latest Pew Internet and American Life Project survey.

Those who do have profiles view them infrequently, if at all, once the account is created and the initial enthusiasm fades. Barely a fifth are accessed "several" times while just 26 per cent are used once a day by their owner.

In further findings, Pew debunks the myth teens are leaving themselves open to predatory adults by making too much personal information available online. Sixty six percent have ensured their profile is protected and cannot be openly viewed.

Pew dismissed as a "widespread notion" every American teenager is plastering personal information over their profiles "for anyone and everyone to read". Pew polled nearly 1,000 US teens between the ages of 12 and 17 during October and November.

Overall, Pew's poll should be welcomed as a sanity check by those who've long called for independent audits of such sites, having suspected - but been unable to prove - that the membership claims made by bloggers and social network owners, and valuations of Wall St analysts, for sites, are way over the top.

Last year bloggers claimed, for example, MySpace had hit one million accounts. That subsequently mutated to mean one million users. Others have claimed 85 per cent of US college students used Facebook, while press reports quoted Facebook last April as having seven million registered users.

Pew's data, though, demonstrates that at least 45 per cent of teenagers are not using MySpace or Facebook-type sites, while 45 per cent do not have any profile what so ever.

Potential investors and buyers like Viacom and Disney should take notice, as 2006's valuations were based squarely on a set of registered users and traffic metrics. MySpace was valued at between $10bn and $20bn, Facebook was valued at $1bn, and Google bought YouTube for $1.65bn.

The logic was this: the more members - members being defined as registered users or accounts - the greater potential for revenue based on search and online ads.

As some bloggers pointed out, though, measuring sites by accounts - and even page views - is a misleading exercise. As Pew has now proved, accounts are frequently left inactive.®

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