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Friends re-ignited
Once upon a time Friends Reunited was many people's first glimpse of social networking websites. Then it got rather overtaken by monsters such as MySpace, Bebo and Facebook. But, as Ed Waller reports, the boys are back in town.
If any website missed an opportunity then surely Friends Reunited is it. An early example of social networking, long before anyone knew about poking, super-poking or throwing sheep at people, the site brought old school chums together and should've been the success story that Facebook, MySpace and Bebo later became.
But it tripped over its own business model. While websites all over the internet moved towards free content models to achieve a critical mass of users to make their banner advertising make sense, Friends Reunited stuck with its pay model whereby users had to subscribe to be able to contact the friends that they'd been reunited with.
It was a model from the old days, pre-Web 2.0, and it meant that the couple who set up the site in 1999, Steve and Julie Pankhurst of Barnet, London, missed out on major internet gold and instead other companies from the US reaped the harvest as many as five years later. The Pankhursts didn't lose out entirely, of course, since they sold up to ITV in 2005 for up to £175million. The site has lost value since then and shed users by the bucketload, as almost half of them migrated to free social sites.
But its fortunes might change. Earlier this month Friends Reunited relaunched as a free service in a bid to increase monthly traffic and make the site a more attractive advertising proposition. Friends Reunited has some 19 million registered users but only around three million active monthly users, according to company numbers. ITV hopes that dropping the subscription fee and introducing new features, such as the ability for people to create 'mini social networks' around particular events in their lives, will give people more reasons to visit regularly.
Friends Reunited is also being repositioned in a bid to compete with social networks such as MySpace, Facebook and Bebo. Rather than offering a means to connect old friends its brand message will now be about connecting all friends. But now that everyone's got all their friends connected at least two other sites, will they want to go through the whole process again for Friends Reunited?
In fact, is social networking losing its appeal across the board? Facebook subscribers are down from their high and News Corporation posted soaring third-quarter results this month, but warned its Fox Interactive Media arm, which includes MySpace, will miss its financial targets of US$1bn by about 10%.
Elsewhere in the webosphere, companies were jostling for position in the web video space (memo to self: mustn't call it TV anymore). The month began with Apple inking deals with most of the major Hollywood film studios - including 20th Century Fox, Universal Studios and Walt Disney - to make their films available to buy from iTunes on the same day as their DVD releases, costing a uniform US$14.99. Another nail in the coffin of the plastic disc.
Then, a few days later, Microsoft retaliated by announcing that TV shows including The Office, Heroes and South Park would be available via its Zune portable media player, after striking digital distribution deals with NBC Universal, Viacom, Turner and others. The move comes more than two years after Apple started selling TV downloads through its market-leading iTunes and iPod combination. The Zune Marketplace will carry 800 episodes compared to iTunes' library of thousands.
While the Zune has failed to make major inroads into the market, selling around two million since launch in late 2006 compared to 10 million iPods sold in the first three months of this year, Microsoft at least had something Apple doesn't - a deal with NBCU.
NBCU programmes accounted for 30% of TV sales via iTunes up until the point at which the studio decided to pull them from the service, complaining at the level and inflexibility of Apple's pricing. The Office and Heroes will line up alongside fellow NBCU title 30 Rock on Zune Marketplace. All will cost US$1.99 - the same flat rate charged to consumers for TV shows on iTunes - but paid in 'Microsoft Points'. The system is the same as that through which Microsoft sells TV downloads to its Xbox 360 games console customers and there's plenty of speculation about how the software giant plans to integrate these products further.
Then, rather quietly given their headline-grabbing bust-up over pricing, iTunes and NBCU reunited to start selling some of its hit shows through the iTunes UK download store for the first time. Who knows if the two announcements were related but it made for another crazy week in the world of online entertainment. Watch this space.
