MySpace Wins Social Media War Games

War Games, as it turns out, is more than just an early Matthew Broderick movie. They’re a series of events involving prominent business schools, including Harvard, MIT and the London Business School. In the past, these war games have accurately predicted events like the AOL/Google search deal, “the game of digital entertainment supremacy last year, which was iPod versus News Corp. versus Microsoft versus Vodafone or Verizon, that Apple would make an iTV entertainment center.”

By simulating the business world with teams of business students, these war games have tackled social media this year. Leonard Fuld, organizer of the war game and president of Fuld & Co., told CNET about the games. Excerpts (emphasis mine):

We were stress testing the (business) strategies one against the other to see who is most likely to succeed. The MySpace team won the game by a fairly good margin. They had a much better argument, which is that content is king. It’s very clear that News Corp. is going to want to pump a lot of its own content through MySpace…and it’s going to cut all kinds of deals with various media companies. The YouTube team also showed that the company is cutting deals with other media companies, and in fact, the BBC was on (the judges) panel. The BBC made a deal with YouTube.

Who came after MySpace?
Fuld: Facebook and YouTube were nearly tied. Facebook had a score of 142, and YouTube had a 140. MySpace came out with a score of 154, and Second Life came in last at 137. So you see that the spread was not all that large. The students representing each team were judged on creativity, accuracy and the foresight in their strategies. The problem with Facebook is that the students that join Facebook eventually graduate, and Facebook is trying to keep them as part of their network as they grow older. MySpace has, in actuality, the oldest group of members; over 50 percent of their membership is over 35.

…Well, for predictions this year they made one about Apple going into the social-networking business (via iTunes). In a year’s time, I would not be surprised if Apple enters that market. Second Life we believe has a breakout opportunity, but nobody could quite find it yet. Second Life may plateau for a while before it as a virtual community truly breaks out. It’s not clear it’s going to build on a mega scale like a MySpace. Right now (Second Life) has about 3 million or 4 million users as opposed to MySpace, which has 130 million or so.

Facebook is going to face a growth crisis, and may reach a plateau in the near future simply because it’s dealing with a student population. And YouTube still needs to figure out a strategy to truly monetize its site, and that’s even before they faced the lawsuit from Viacom.

The teams found that MySpace had the most viable business model, but others really weren’t that far behind. I would hope that the leaders of these businesses know about the shortcomings these business students identified, but it might be good for those of us looking to market via social media to be reminded of them as well.