MySpace gen builds business on social sites

By Lauren Shepherd

updated 2:31 p.m. ET June 12, 2007

NEW YORK - While at a summer barbecue with her brother and his friends, Joyce Kim checked her e-mail and saw an unfamiliar name.

The e-mail was from a guy she’d supposedly met at a party who now wanted to take her out on a date. The only problem was, she didn’t remember ever meeting him.

She read the e-mail aloud to her brother Jared and his entourage — all “tech geeks” who had toted their laptops to the party. The group immediately turned to their keyboards to do a little cyber stalking and within a few days, Jared Kim was running a company designed to do just that.

His experience is both an example and a cautionary tale for a new generation of code writers, programmers and Web developers who are increasingly using social networking sites as platforms to launch their own businesses.

This new “cottage industry” has become so prominent that even Facebook — a popular college social networking site — agreed in May to partner with some of these so-called “third-party” businesses. The deal will allow select companies to run their programs off Facebook’s platform and generate ad revenue.

But when Kim first had the idea to create his company at that barbecue in May 2006, it was more of a fun summer project than a moneymaking venture.

Working with his friends to Goggle, check Friendster and search MySpace for any information they could find on the prospective date, Kim had a thought: Why not write a program that searches all the social networking sites at once and creates a profile of the person you’re searching for?

A lot of people spend hours browsing sites to stalk friends, ex-girlfriends and love interests online “but there isn’t a streamlined process that’s, like, one shot, boom,” said the now 19-year-old freshman at University of California, Berkeley.

In one day, Kim had built a program he calls “a little hack I put together” and named it Stalkerati.

In three weeks, the site was featured in a blog. In another week, 10,000 users were on the site per day.

All the traffic soon got the attention of MySpace, the social networking company owned by News Corp.’s Fox Interactive Media. MySpace considered Stalkerati a security risk since it required a user to give their MySpace password and user name. It blocked Stalkerati and other social networking sites followed.

MySpace is still, in many ways, where it’s at in the third-party world. It allows users to type in Web code directly into profiles. That allows them to change the look of their actual profile page or create programs that work off the MySpace site to provide services it doesn’t offer.

“Anything you can do on the Web is at least possible on MySpace,” said Matt Brown, a 25-year-old MySpace user and co-owner of an interactive marketing agency in Denver, Colo.
Do a Web search for MySpace and you’ll find a wide variety of third-party companies, including sites that offer codes that can add colors or background pictures to your profile page. Other companies offer additional tools for inputting pictures or sending instant messages to MySpace friends.

Many of these sites are funded with click-through ads that can make the owner anywhere from $1 to $10 for every 1,000 page views. Since many of these sites get thousands — or even hundreds of thousands — of page views, the money can add up.

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