Rupert Murdoch’s $580million acquisition of MySpace may have seemed a steal compared to the $240m Microsoft paid for a 1.6 per cent stake in Facebook, but all is not well with Murdoch’s plans for his social network, and it is being felt in its stock price after Fox Interactive Media (where MySpace sits in the News Corp empire) reported it would miss its 2008 revenue goal of $1billion. News Corp’s stock price has slipped 9.9 per cent this year alone.

Sure, Murdoch is throwing money at MySpace to expand into India and South Korea and add a music downloads service, but the social network is struggling to attract and retain advertisers in the volumes it needs because of the risk of their brands being shown next to inappropriate user-generated content. It is precisely the freedom and flexibility MySpace user love so much, which is causing the company problems with advertisers.

Bloomberg reports that Fox Interactive’s costs will rise a massive 46 per cent this year as they bid to open new channels for MySpace - almost as much as revenue is expected to grow. The bottom line with investors is that while MySpace continues to try to grow its audience in different markets - it is still failing to fully monetise the vast audience it already has.

However, today MySpace launched a new ad platform to give advertisers more control over where their ads are being run. It is a small step - arguably long overdue - but whether it will solve the site’s short-term adveritsing issues remains to be seen, when rival networks have already stolen a lead. While Facebook wrestles privacy issues, today enabling an ad system opt-out, it is at least driving strong advertising revenue.

MySpace’s hope has to be in the medium term, beating Facebook into new markets where advertiser sensitivity to site content is far less pronounced, doesn’t it?

Would you pay £2000 to join an online social network? Well the FT is hoping so with the announcement today that its will be launching the first of what it’s calling Members Forums aimed at leading figures in digital, new media, mobile and telecoms. The £2000 includes an access pass to its conferences, which might be the real motive for setting up these groups. It will be interesting to see how the tools and services put in place by the FT compare to those freely or far more cheaply available from the likes of LinkedIn and others.

The idea of focusing on elite executives and bringing them together online is an in interesting one and I can see the logic of the FT helping to do this where sector-specific networks don’t currently exist. The Property and Luxury Goods sector are apparently the next on the FT’s list to be targeted.

Whether members will continue to pay the premiums once larger and far cheaper alternatives become established is another question.

I perhaps shouldn’t have been surprised as I was at the volume of press coverage triggered by figures from Nielsen yesterday, claiming the first ever monthly fall in Facebook users in the UK. According to the research firm only 8.5 million unique users in Britain spent time on Facebook in January 2008, compared to 8.9 million in December - a 5% fall.

Speaking to Forbes yesterday I was keen to stress that we shouldn’t jump to conclusions based on a single set of figures, but at the same time we shouldn’t expect the growth of social networks to continue at such a phenomenal rate. Despite this hiccup Facebook fans have been keen to point out that the audience is a remarkable 712% higher than in January 2007 and 9% larger than at the end of October 2007. This contrasts with an apparent 9% fall for MySpace over the course of last year.

What these figures have done is moved the focus onto the next stage of social networking development. A number of commentators have suggested that the future of social networking sites lies in them becoming more niche. The million dollar question is which niche?

The sub-25s may be more relaxed about privacy and advertising but arguably more promiscuous over which ‘cool’ site to spend their time on. Older professionals may be more stable and attractive to brands but generationally far more sensitive to how advertisers take advantage of their personal data.

In any case there’s no need to perform the last rites over social networking quite yet.

UPDATE: Henry over at Tamar has some interesting analysis predicting that next month should see the Facebook numbers recover…

Hillary Clinton’s lack of appeal with young voters is quickly emerging as her Achilles heel and a look at each of the candidate’s popularity on Facebook provides further evidence. Barack Obama has attracted almost 200,000 supporters compared to just 60,000 for Clinton. Last night saw the first of the ABC/Facebook debates and the accompanying US Politics Group - from where the chart below is taken - is well worth a look. The most striking feature for me is the contrast in Facebook support between the Democrats and Republicans overall. There are no shortage of young Republicans on Facebook but it appears the GOP candidates either don’t know how to attract them or bizarrely, simply don’t care.

6. PCTV wins the battle with IPTV
Early next year we are likely to see both 02 and Orange join the battle with BT Vision and others to displace the Sky, Virgin and Freeview set-top boxes in our living rooms. As they spend big to each attract at most a few hundred thousand subscribers, millions of consumers will instead top up their TV viewing online. The implications of the Kangaroo initiative, which will bring together the on-demand services from the BBC, ITV and Channel 4 shouldn’t be underestimated. Kangaroo has the potential to bring PCTV into the mainstream via a single application and EPG. But it will need to quickly become compatible with all those Vista enabled PCs people will have got for Christmas.

In fact one of 2007’s most exciting moves for both online broadcasting and social networking, was Bebo’s landmark deal with the likes of the BBC, Sky, Channel 4 and Endemol to allow users to embed TV programmes in their profiles. A fundamental shift in taking TV to specific communities rather than trying to attract specific communities to TV. The implications of the deal for much hyped but little used services like Joost should be keeping their investors awake at night.

Finally, as millions stream TV content to their desktops, the spotlight will again turn to the performance levels of broadband providers. Download limits and throttling connections will be exposed as the disingenuous excuses for poor service they really are. ISPs and telecoms companies will need to think carefully about where they direct their infrastructure investment, or face a very public consumer backlash.

7. DIY Social Networking
Want to create your own social networking site? Of course you do and so will everyone else, well maybe. As I wrote recently vertical social networks are gathering momentum. With so many categories currently un-catered for, it will be a boom year for the software companies providing off-the-shelf solutions. Many firms will also see the benefits of creating their own social networks as a replacement or as an alternative to expensive and cumbersome corporate intranets and extranets. Whether they will give their staff enough time to use them is of course another question.

8. Traditional media decline accelerates
David Crow at The Business has a great analysis on the seismic shifts in the media landscape this year and the likely developments in 2008. To reverse the general declines in newspaper circulations, more national newspapers will need to follow the example of the Daily Telegraph and invest in their digital operations. The amalgamation of the BBC’s offline and online news operations could lead to a decline in both the quantity and quality of online content, allowing other news organisations to catch-up. The Wall Street Journal liberated from a hefty subscription by Rupert Murdoch, will also be a new force to be reckoned with. Crow also looks ahead to the growth of DAB radio with Channel 4 launching a number of stations to compete directly with the BBC. He concludes by saying, “The firms that succeed in 2008 will be those that focus on the needs, desires and interests of their consumer in the contemporary marketplace – and discard their archaic, elitist prejudices born of a different era. For those still referred to as the “traditional” media, 2008 will be the make or break year.” Couldn’t agree with him more!

9. The Press Release’s condition becomes terminal
In response to the traditional media going increasingly digital, the demand from journalists for well packaged multimedia content will be stronger than ever before. The SMNR and Social Media Newsroom will become the industry standard for modern communication with press and bloggers. The days of four pages of double-spaced waffle will thankfully be nigh.

Google struggles with the forces of darkness

Once one of the most loved of internet brands, ordinary internet users will begin to reassess their warm relationship with Google. As with its recent announcement to obliterate Wikipedia, the brand will behave in a way that challenges Microsoft for its evil empire crown. While doing little to damage revenues at first, the loss of public goodwill will prompt a harder line from the competition authorities and legislators, curtailing the extent of Google’s long-term growth. In 2008, while its takeover of Skype gets through, its hostile bid for Apple is seen as a step too far.

2007 has been an amazing year personally. Leaving the warm bosom of agency life was a difficult decision but I’ve since been lucky enough to work with some amazing clients, agencies and practitioners on some really ground breaking digital PR campaigns. It’s been a journey into the future of PR and the future looks very bright indeed. So what do I think 2008 will bring?

1. The Year of the Widget
I have been spending a lot of time over the past couple of months working with some great developers on the design of widgets. I’m not talking about Zombies here, but creative, engaging, viral and above all value-added applications which support wider PR campaigns. The integration of widgets into the armoury of digital PR tactics will really take off in 2008 as developments like OpenSocial improve the economics and allow single applications to access larger audiences across multiple social networking sites. Beyond their role in PR, the widget will continue to change the shape of online advertising, as they move onto the desktop and mobiles – this recent article in Adweek is well worth a read to get up to speed.

2. Do you Vlog?
Video blogging will be one of the biggest tech trends of 2008. This will be driven by high profile bloggers such as Iain Dale experimenting with the medium as well as new platforms like Seesmic and Magnify. Another driver will be next generation mobile handsets with better quality in-built video cameras combined with falling data costs enabling vlogging on the move. It could even capture the media zeitgeist from Facebook, speaking of which…

3. Facebook media backlash
A bit like Jade Goody, having devoted acres of coverage building it up, 2008 will see the media try to bring Facebook down. The Beacon disaster has seen the US press sharpening its knives and the shift in sentiment will no doubt cross the Atlantic. Despite the less favourable coverage, Facebook will continue to grow and members will spend more and more time on the site. Reports of Facebook’s imminent demise by a few over excited commentators are I feel greatly exaggerated. The positives that make the site so great still far out weigh the disadvantages. The Beacon saga has shown Mark Zuckerberg that he stops listening to users concerns at his peril – I don’t think he will be stupid enough to make the same mistakes twice. Removing the negatives in terms of poor data protection and privacy, overly intrusive commercialisation and the small but growing volume of application related spam will need to be his top priorities for 2008.

4. Jumping on the social media bandwagon
Johnny come lately PR agencies will continue to jump on the social media bandwagon. Expect PR Week to be full of more stories of traditional PR agencies appointing heads of social media and creating specialist divisions.

5. A high-profile PR account shifts to a digital agency
The fundamental shifts in the PR industry will come into sharp focus when a high-profile client shifts its PR account to a Spannerworks-esque agency with digital and search at its core. There will be much debate and navel gazing. A few weeks later agencies respond by – yes you’ve guessed it – doing more of number 4.