It’s always been possible to make money on MySpace if you didn’t pay much attention to the terms of service. The site has never consistently enforced its ban on commerce. That’s partly due to technical reasons–from a content filtering standpoint, the problem is much worse than detecting whether something is spam or not–and partly due to the shear size of the MySpace community. On the other hand, there have been many cases of MySpace blocking third parties or even removing commercial content from profiles. This prompted me to blog a while back that MySpace doesn’t want you to make money.

Clearly, MySpace has the right to shut them down, given their terms of service agreements. The more interesting question is the stance that the company will take in the long run with respect to the openness of their pages. Much of their success was built upon the user experience third party plug-ins/widgets provided. Now that they are big, perhaps they think they don’t need the help anymore? That would be a short-sighted stance. The Web is a big and varied place. Walled properties don’t have a history of doing well.

Well, it seems that the tide is changing under pressure for FIM to make lots more money. MySpace has been working on improved ad targeting. They have been working on an API for nearly a year, while many others are already publishing ways to access MySpace programmatically (here, here, here). And now, LA Times reports that MySpace is contemplating lifting the ban on commerce.

“We don’t want users’ pages to start looking like NASCAR,” MySpace Chief Executive Chris DeWolfe said.
But behind the scenes, the issue is being hotly discussed as DeWolfe and his team of top executives at the biggest property within News Corp.’s Beverly Hills-based Fox Interactive Media grapple with the imperative of squeezing more money out of MySpace. MySpace doesn’t want to encourage the likes of Dolce, Billard and Tequila. But its ban on commerce is difficult to enforce. If the policing efforts fail, shouldn’t it at least try to make money from the online sales it makes possible for others by taking some sort of a cut?

This is all great news for consumers, brands and, most definitely, startups looking to leverage the power of the major SNs. It will certainly be challenging for MySpace. They operate under a very different set of constraints than Facebook, for example. They’d have to figure out a way to do this so as to not jeopardize revenues from large advertisers. On the flip side, MySpace has an opportunity to deliver highly differentiated value because it’s community’s vibe is unique. All in all, the indications of a possible change in direction are refreshing.