• The Wall Street Journal, Monday, August 4, 2008 12:15 PM

When News Corp. delivers its second quarter earnings on Tuesday, investors will keep a keen eye on the performance of Fox Interactive Media and MySpace in particular. The social network, which generates an enormous amount of traffic, has underwhelmed in the advertising department.

The Wall Street Journal says that MySpace's "hypertargeting" system, which analyzes the profiles of MySpace users and categorizes their interests into more than 1,000 "buckets", will receive the most scrutiny. The behavioral targeting system debuted last fall, and the Journal says that feedback from advertisers has been positive. "The closer you get to the audience you want, the better you get in terms of clicks or sales of the product," says Sean Muzzy, senior partner and media director at digital ad agency Neo@Ogilvy. Media buyer James Kiernan of Publicis' Starcom MediaVest Group says he's seen "hypertargeting" yield a 25% to 30% increase in consumer response compared with regular ad purchases.

By offering targeting, MySpace can charge roughly double normal ad rates, which on social networks only run a few dollars per thousand impressions. But will "hypertargeting" sufficiently address concerns about MySpace's business prospects? It remains to be seen, as media buyers claims no one is committing large sums of money yet.

Read the whole story at The Wall Street Journal »