Social networking sites were the flavour of the year in 2007, and judging by the number of people keen to make their blogs, photo albums, home movies and personal profiles public this is the start of a new wave of innovation.

Sites with tools that enable people to build, manage and share profiles and add features and services, including messaging, blogging, photos, movie clips, music are at the epicenter of online activity. They were becoming significant social and political forums and an important parallel to mainstream media.

The music, movie, publishing, fashion and other related industries were caught off guard again by this major trend curve; social networking was seriously influencing not only opinion and attitudes, but buying trends. 

Google acquired YouTube only two years after it was created by two former PayPal employees; Fox Interactive Media’s Yahoo! acquired del.icio.us and Flickr, and Rupert Murdoch’s News Corp spent half a billion dollars on the company that owned MySpace.com.

Social networking sites fall into a burgeoning category known as second generation web, or Web 2:0 services, which deliver richer more dynamic and interactive experiences.  Web 2:0 is typically about the ‘live web’ or websites that improve communication between software, web sites and people.

Home video show

By 2010 it is estimated that advertisers will spend over $US2 billion on social networks in the US alone. The killer application is video based communication, nearly half of which is produced by users themselves.

Locally the trend is gathering momentum. Thousands of New Zealanders are logging on daily to sites including MySpace, YouTube, Bebo, Facebook, LinkedIn and Google’s orkut. New Zealand on-air is funding productions made specifically for the Internet, TVNZ launched its own channel on YouTube, regurgitating edited fragments from popular local shows alongside news, footage of Kiwi musicians, film trailers, historic television clips and dozens of videos of the haka and bungy jumpers.

New Zealand’s best known YouTube contributor Lonelygirl15, Tauranga-born actress Jessica Lee Rose, featured on the cover of Time magazine after achieving 7.7 million viewers on her channel; remaining popular, even after it was discovered she acting in a made-for-the-Internet creation.

MySpace launched a New Zealand focused site in February 2007, kicking off with about 300,000 Kiwi members and a live concert from Kiwi band Evermore. MySpace had more than 60 million users worldwide and was credited with launching the careers of a number of top bands. About half a million Kiwis used MySpace and the interest was escalating.  Rival YouTube also launched a local channel in October highlighting homepages and videos relevant to the local market.

Telecom’s Xtra had partnered with Microsoft to provide content and online services for its default home page and web portal back in 2002. It gave its high ranking site a complete make-over earlier this year after entering a new relationship with Yahoo!7, a joint venture with Australia’s Seven Network, to become more aligned with the new social networking trend.

Speech bubble

Telecom promised an enhanced range of news, sport, weather and messaging services plus online photo sharing, local news, Internet radio and enhanced spam and virus protection. Despite the opening day freak out in August when some people lost email access for up to a week, the Yahoo!Xtra Bubble site soon stabilised as an exclusive VIP area for Telecom’s 600,000 Internet customers.

Among the premium services is a personalised home page with customisable news, entertainment and information from a choice of over 300,000 content sources, email storage, online photo storage and sharing with Flickr Pro, a 1Gb online briefcase and an all-in-one free security suite, featuring Norton AntiVirus. Clearly Xtra was seeking to differentiate and build online loyalty.

Networking websites had a 270 percent increase in visitors worldwide during the 2006-2007 year, according to Comscore. Over the year to June 2007 MySpace remained top of the social networking heap with 114 million unique visitors, up 72 percent on the previous year. However Facebook, was catching up with 52 million unique visitors, up 270 percent. In terms of sheer growth though, Bebo which had a strong following in New Zealand, had 18 million unique visitors, up 172 percent.

Social networking sites made up four of the 20 top websites New Zealanders visited in August 2007 according to Hitwise; Bebo was in fourth place, MySpace at 10^th, Facebook 12^th and Friendster at 20^th. Facebook’s share of website visits increased by 240 percent between May 2007 and August, possibly due to the school holidays, overtaking MySpace for the first time.

While the social networking trend was clearly achieving mass market momentum there were also concerns about its impact on the youth community, as new forms of social snobbery and bullying came to the fore. Youth were virtually setting themselves up in a branding exercise and judging each other based on the number of ‘friends’ they could attract.

You could get rejected or gain a great ego in cyberspace but you still had to deal with the emotions down on terra firma. Mostly there was genuine collaboration but there was also a wild side; unpleasant or invasive images could be posted on sites and some were pushing the boundaries with crazy exploits, bonnet surfing and shock antics.

Low res videos published on public sites were also a worry. Bashings were being filmed and posted, speedsters clocking up ridiculous speeds on the open road and filming it were exposed online, and even thieves and a murder were being outed on the web.

Stranger danger

Security firm Sophos conducted an online survey to try and understand how seriously users took the strict privacy settings on social networking sites and was surprised to discover most were are all too willing to accept strangers as friends.

The survey found over 40 percent of Facebook users would accept a "friend request" from a complete stranger, and more than three quarters revealed their date of birth, address and information about their education or employer. Some exposed complete CVs and even their mother's maiden name, a detail often used by banks and various online services to help users retrieve forgotten passwords.

Sophos's head of technology, Paul Ducklin, warned personal details on social networking sites could be used maliciously by thieves to impersonate the user, after which they could obtain passwords for online accounts and access to private computer networks. While both Facebook and MySpace allowed users to restrict profiles to approved ‘friends’, the general definition of a friend was too loose, and site users were too quick to approve strangers.

And in a more elaborate form of social networking Second Life has staked out some serious virtual real estate where you can create your own avatar, and complete with fashion accessories and travel arrangements, explore several online worlds . In October 2007 there were nine million residents and millions of literal dollars being transacted to buy Second Life’s Linden dollars every month.

The Anglican Church runs meetings in Second Life and among many others Kiwis, the All Blacks, the Mongrel Mob and real estate company Harcourts have established a presence there. IBM even has sales avatars servicing customers in New Zealand.

The true diversity of the Internet was being explored and the power of the consumer was being flexed, once word gets out about something hot it can rapidly reach what is known as ‘tipping point’ with a wave of online behaviour propelling a new product or service into the limelight or sending a former unknown artist up the pop charts.