American Consequences - January 2018

The Obvious American Giant... Two Ways to Profit from ‘The Transition’ Excerpted from Stansberry’s Investment Advisory Facebook wasn’t always poised for domination. From 2005 to 2007, MySpace was the largest social media website in the world. At the time, MySpace was owned by Rupert Murdoch’s News Corp. But MySpace made several fatal mistakes. It loaded its webpages with as many ads as possible, right from the start, making the site slow and difficult to use. In other words, it tried to monetize its users too soon... at the expense of the users’ experience.


MySpace also didn’t do a good job of policing its website. It allowed the use of aliases, so people could hide behind fake names. It grew into a seedy site, known for pornographic content, spam, and phishing. Advertisers retreated. As anyone who has seen the movie The Social Network can tell you, Facebook founder Mark Zuckerberg took a completely different approach... He waited until after his website

reached critical mass before monetizing it. Facebook wasn’t cluttered with advertisements. It was safe and clean, and it gave users a much better experience. By 2008, the number of Facebook users surpassed MySpace users. But during this period without much revenue, the company had to front the cost of Internet servers – and eventually server “farms.”

54 January 2018

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