What Do Friendster's Problems Mean For Social Networking?

Posted on May 29, 2005

Things do not appear to be going well at Friendster. The Friendster CEO has departed and Reuters reports that Friendster traffic in April 2005 was 15% lower than in April, 2004. The company that helped springboard social networking appears to now be lagging behind some of its competitors.

David Card, an analyst at Jupiter Research, told Reuters, "What these social networks have shown is that you can use the viral capabilities of the Internet to grow a site very quickly, but I'm not even sure that anybody has proven yet that these businesses by themselves are sustainable, stand-alone businesses."

Friendster has 703,000 visitors in April. This was a 15 percent drop from its visitor count for April last year. The average time visitors spend on the site has also tumbled 65% year over year according to data from Nielsen/NetRatings.

Some might see this as the first signs of trouble for social networking itself but with MySpace.com's traffic soaring and web giants like Yahoo and MSN adding more networking features this does not appear to be the case. However, the increased competition from the top Internet companies might continue to drain traffic from some of social networking websites.

Many companies are also combining blogs with social networking services. Friendster did eventually add blogs but arrived a little late to the party. Friendster has recently tried to add celebrity bloggers like Pamela Anderson which may be a way to boost traffic. People do like to read about what the celebrities are up to.