MySpace co-founder queries future of SnapChat and admits mistakes in News Corp sale
MySpace co-founder Chris DeWolf has revealed that he could see Snapchat "disappear or lose its position" due to the apparent lack of commercial opportunities and easily replicated technology.
Speaking at SXSW, DeWolf was discussing his move into social media gaming, revealing that he had fallen out of love with the music industry, but found a love for gaming as a consequence through his company, SGNgames.
While discussing his views on social media, including his thoughts on the rise of Facebook, DeWolfe was asked of his views of messaging platforms such as Snapchat, which he described as having reached the pop culture zeitgeist.
"It's young and, I am being trite in saying this, but it's unclear how you monetize it, so I could see that going away or becoming less relevant," he stated. "There are really no barriers to entering technology, it's not super complicated technology, but they do have a critical mass of users here in the US and it's going to be difficult for them to expand globally because there is so much competition."
He later admitted "I have definitely learned a lot of lessons," - when he left in early 2009, Facebook had just overtaken MySpace for users internationally although it was still ahead in the US.
"We paved the way in a lot of perspectives in terms of being able to sell a social network. No one really understood what it was in 2005. There was a common wisdom that you couldn't make money from social networks which Facebook has definitely proved everyone and so have Twitter...there's definitely money to be made."
He continued to describe the acquisition as "a growth company that was put with a more mature media company" which had an expectation of earning revenue like a cable or movie company. "There wasn't time for that. " he claimed, citing the acquisition of YouTube by Google as comparison.
"Google let Chad and Steve, the founders, run with it for three or fours years and told them to grow it to as big as they could and they grew it to 1 billion users and there was almost no ads."
He revealed he tried to contact YouTube to develop standardised video adverts to sell to advertisers but never received a response.
"During the same year where we were supposed to do $1bn in revenue, those guys lost $500m in revenue. And it was the right thing to do. They grew their userbase and turned on the revenue tap at exactly the right time, having that great user experience for as long as your company can grow. You see Snapchat, WhatsApp, Instagram doing that and Facebook has managed that revenue, timing, relevance, calculus perfectly. I don't think we managed it so well, as there were corporate culture issues between us wanting to grow the userbase and being with a public company and needing to hit revenue above expectations."
He however didn't admit to regretting the sale, stating "it's a really tough thing to do to pass up a check which changes you and your family's life. Mark Zuckerberg did that and I admire him greatly for that...In retrospect we could have sold for a lot more, maybe found a better move and it might have been a better experience for News Corp if they hadn't acquired us."
He admitted that befire he left, MySpace was distracted from its core service by developing a classified service, TV and movie review sections to sell more advertising.
"We got too far afield from basic social networking, which was how to quickly find friends and the most effective way to set up a messaging service, share and tag photos. Those are the key areas."
He also revealed that while he was interested in one day developing games for Google Glass and Ochulus Rift, he planned to stick to the focus of puzzle games that SGN currently follows, focus on its core audience, but that they may look at the platforms in years to come.