Is social networking technology the next jump in the .com boom that we can expect to see?  A few years back, who had ever heard of Facebook, Myspace or other of the social networking sites that we hear every day (even on the news).  More and more companies are seeking new and innovative ways to tap into these online social networking sites for advertising, and it is estimated that nearly 4 billion dollars could be spent on advertising by 2011.

How many of us can forget when Rupert Murdoch’s company News Corp. purchased MySpace for $480 million (July 2005) and many questioned why he’d do that given that it was considered little more than an overcrowded hangout for teenagers?  Today, MySpace has more than 220 million registered users and is turning a profit, anticipating more than $500 million in revenue during the fiscal 2007 year.

Clearly the decision makers at Microsoft feel that this trend can only continue, since last month they purchased a stake of over 240 million dollars in Facebook just last month.  We anticipate that this is in direct relation to Microsofts long term plans to gain some control over online ads (According to Steve Ballmer it is anticipated that online ads would be 25% of their business).  And of course what about Googles announcement that it has plans to jump into the market offering a standardized code for online social networking – even though they control a fair amount of the advertising revenue on the internet today.

It will be interesting to see how the users of Facebook, YouTube and other social networking sites take to advertisements showing up.  Let’s not forget the fiasco that happened when Facebook tried to appease marketers and cme up with “Beacon” which partnered with others to place messages in users’ news feeds!    The new advertising methods will have to be carefully thought out and put into place with full knowledge of the users of these social networking sites.

There is no doubt that on the whole, we are all more comfortable with the internet, and what’s even more interesting is that social networking sites offer opportunities to get to know others.  2006 could be considered the year of “My Space:  The Year of MySpace:

<!--[if !supportLists]-->•         <!--[endif]-->More than 100 million accounts created

<!--[if !supportLists]-->•         <!--[endif]-->Third most popular site in the U.S. (after Yahoo and Google)

<!--[if !supportLists]-->•         <!--[endif]-->55% of online teens use social networking sites

<!--[if !supportLists]-->•         <!--[endif]-->Of those who use social networking, 48% log on to the sites at least once a day or more

<!--[if !supportLists]-->•         <!--[endif]-->16% of online adults use an online social networking site like MySpace, Facebook or Friendster and 9% use them on a typical day

There are some active discussions going on among public libraries to make their information available online.

Social Networking is definitely a field to watch.  Cisco, and others who may have been a little slow to get involved will become bigger players, however the ones to watch probably remain Google and others who have already established themselves.