YouTube, Digg, MySpace: How much is a non-paying ‘user’ worth?

YouTube, Digg, MySpace: How much is a non-paying ‘user’ worth?

Kevin Rose questions the propriety of Jason Calacanis putting a price tag on the active contributors at Web 2.0 Social Web properties such as Digg and Netscape (See “Digg vs. Netscape, Kevin vs. Jason, Web 2.0 vs. commercial Internet”)


This cool image is from “Nonprofit & Fundraising Resources” which is a pretty cool site.

The bigger question is: How much are the Web 2.0 Social Web legions of non-contributing, and non-paying, users worth?

Using very rounded numbers, here is a “quick and dirty” analysis:
MySpace 2005 acquisition price: $580 million
MySpace 2006 “friends” user base: 100 million
MySpace 2006 ad revenues: $200 million

MySpace acquisition price reflects an approximate multiple of $5-$6 per “friend.”

MySpace is currently generating approximately $2 in revenue per “friend.”

The MySpace effort to grow ad revenues since its acquisition by News Corp. last year provides would be bidders for Digg, YouTube…a valuable reference for measuring the financial potential of a large, non-paying base of young Internet users.

Judging by the comment section of digg, Digg users value is still in the negative dollar amount range.

read more | digg story

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Inquisitor of reason and objective analysis of modern politics and technology.