Why Bertelsmann Is Wrong To Compete With MySpace
from the try-to-do-something-different dept
Back in the day, Bertelsmann was one of the few more enlightened media companies. Under the leadership of former CEO Thomas Middelhoff, the company actually wanted to embrace file sharing, and invested in the original Napster. Middelhoff talked about how the internet was changing the media industry, and why the companies in the space needed to embrace the change. Then Napster lost its court case, the internet bubble burst, and the old guard rejoiced in saying that Middelhoff was wrong, eventually forcing him out of the company. However, it looks like Bertelsmann is now trying to get back into the internet game — though a few years too late. Their latest plan is to build an “entertainment-driven social networking web site” designed to compete with MySpace. Of course, this is exactly the wrong way to go about things, for a variety of reasons. First, it’s unlikely that Bertelsmann will be able to effectively compete against MySpace because it will be limited by the company’s attempts to promote its own content. In fact, the article clearly states: “Bertelsmann aims to create a community for its music and video projects.” Limiting the community to be just around Bertelsmann content completely misses the point of what made MySpace successful — which was the freedom to let the community figure out what it was about. However, even more important than that is simply the idea of trying to compete head on with MySpace. We all know that social networks come and go (witness the NY Times retelling of the Friendster story — a story that’s been told many times before). However, you don’t succeed by simply trying to compete with what’s out there, you succeed by trying to fill a market niche that is left unserved by the current providers. If anything, it looks like Bertelsmann’s attempt is to offer less. If anything, it sounds like it should follow the path of Wal-Mart’s brief flirtation with social networking, that ended up dead before anyone noticed.