In MySpace & YouTube vs Google & Yahoo, – CPM vs CPC Don Dodge says: Google mentioned on its quarterly analysts conference call that they didn’t book some ad revenue this quarter, perhaps a billion dollars, because they didn’t have enough quality page inventory for advertisers.
Quality page inventory is an elixir that is hard to define and even harder to procure. Due the mysterious ways in which Adsense tends to serve ads, sometimes you end up with the lowest quality ads on the pages with the most traffic, while the inside pages get much more targetted ads that bring in more money, but they don’t get you the inventory that you want. Ad fatigue, especially on landing pages/homepages is something that content publishers and their advertisers cannot live with. So it is no wonder that Myspace can’t monetize its awesome traffic in the way it would like to.
A sloution that we’ve been pondering for this issue is to develop internal tagging/categorisation of content served by us so that there is some control over the quality of the inventory. But that is a totally different ballgame on a website that only has user generated content. One way to work around this issue would be to use tags and serve ads based on them, but as far as I am aware, Myspace does not have any such feature or categorisation. In that context, short of developing a comprehensive data mining engine, I don’t see how they can scale up the revenues in relation to their traffic.