Social Networking Site Memberships To Reach 230 Million
A new report from independent market analyst Datamonitor expects global active memberships in social networking sites to reach 230 million at the end of 2007.
The report, The Future of Social Networking: understanding market strategic and technological developments, says that infrastructure providers, social network providers and wireless players stand to profit largely in the near term.
Ri Pierce-Grove, technology analyst at Datamonitor and author of the report, said: “For social networking services, barriers to entry are virtually non-existent, and both competition and innovation are ferocious.
“Users have a vast array of options, from Titanic generalists like MySpace and Facebook to tiny individual networks on DIY platforms like Ning. This year revenues from social networking services should reach USD$965 million growing to USD$2.4 billion by 2012.”
According to Datamonitor, by the end of 2007 Asia Pacific will account for 35% of the world’s social networking memberships. Europe, the Middle East and Africa (EMEA) will hold 28%, North America 25% whilst the Caribbean and Latin America (CALA) will account for 12%.
Adoption curves vary dramatically by region, but Datamonitor expects membership growth in all regions to have peaked by 2009 and to have levelled out by 2012.
Pierce-Grove added: “A sane approach to this market requires balancing the two perspectives. The extraordinary proliferation of online social networks is fuelled by real innovation and is substantially changing the way we communicate.
“However, the hothouse atmosphere of easy capital, media attention, and user curiosity which stimulates creativity will not be sustained indefinitely. All players therefore must develop a two-pronged strategy in order to survive the extremes of heat and eventual chill which this market will undergo.”
Media properties, search firms, and other commercial entities will look to lock down the new constellations of audiences brought together by social networking services, says Datamonitor.
Market experimentation will continue as operators seek the optimal combination of features and functions as well as more sustainable operational models. However, the sites themselves will not necessarily consolidate; special interest social networking services will continue to play a valuable role.
“As the market becomes more crowded, it will become harder for social networking sites to remain independent. Acquisition can solve scalability issues, improve content and search capabilities, and extend visibility and reach,” said Pierce-Grove.
Figures from Nielsen//NetRatings released at the end of September show that Facebook and MySpace are now both visited by one in five Britons online, receiving 6.5 million and 6.4 million unique users respectively in August.
The Office of National Statistics recently published a report showing that the number of UK households connected to the internet has jumped by almost one million in the last year alone, to reach over 15 million.
Datamonitor: www.datamonitor.com