The civil case, which was filed in July 2006, related to hundreds of fake profiles for Barrichello that were created on Orkut, some of which depicted him as a toy turtle – I kid you not.

Earlier this week, Brazilian media published the outcome of the Sao Paulo court’s ruling, which ordered Google to compensate Barrichello half a million dollars in damages upfront and a daily fine of $590 until all the profile pages relating to the F1 driver were removed from the social network. Note: different media report different amounts.

Google told local reporters that it will always remove illegal content from Orkut but does not feel responsible for all other content that appears on there, and they don’t expect to have to police negative commentary about celebrities. Google can still appeal the case in higher court.

This isn’t the first time Google finds itself in Brazilian courts over Orkut.

On August 22, 2006, a Brazilian Federal Judge ordered Google to release Orkut user’s information of a list of about two dozen Brazilian nationals, believed to be using the social network to sell drugs and to be involved in child pornography. The judge ordered Google to pay $23,000 per day in fines until the information was turned over to the Brazilian government. Google back then stated that it would not release the information, on the grounds that the requested information is on Google servers in the U.S. and not in Brazil, and is therefore not subject to its national laws.

For what it’s worth, multi-millionaire Barrichello was looking for ‘respect rather than money’, and that he would be donating the money awarded to him in court to his non-profit organization Barrichello Kanaan Foundation. On Monday, the F1 driver tweeted a quote from Swiss philosopher Henri-Frédéric Amiel (which I suspect was freely translated from his famous quote “There is no respect for others without humility in one’s self”).

My guess is he simply doesn’t like turtles.

(Via F1Planet)

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Forgive us for not noticing sooner, but last week Google’s social network Orkut announced that it is rolling out a complete redesign. The new site is faster and, like every other social network these days, puts the activity stream front and center. Orkut has actually reduced the number of pages so that the most popular actions can all be done from the home stream. For instance, there is now in-line commenting for status updates, photos, and videos. And the various notifications (”friend requests, testimonials, community requests or birthday announcements”) have all been consolidated onto the homepage as well.

Orkut also now has video chat, in addition to regular text IM. Access to other Google properties such as Gmail, maps, and search are now integrated at the top of the homepage. Profile pages are more customizable, and photo uploads are faster.

The changes come at a time when Orkut is seeing major encroachments by Facebook in its strongest markets of India and Brazil (despite its efforts to make it hard for Orkut users to switch).

Google’s social network definitely needs a refresh. In September, it attracted 51 million unique visitors across the world, down from 54.5 million in July, according to comScore. Facebook is about six times larger than Orkut worldwide, and even Twitter recently surpassed it with 58.4 million global visitors just to Twitter.com.

Can the stream save Orkut, or is it too late?

Hat tip to reader Anand Srinivasan

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In other words, now when you export your list of friends from Orkut, all you’ll get is a list of their names, location, birthday, gender, and links to the Orkut profiles. Which means it’s basically useless. Facebook can’t use the data to invite your friends, and you can’t use the data to actually contact and share with your friends, which is the whole point of a social graph.

We reached out to Google about the issue, and a Google spokesperson gave us this statement:

“Mass exportation of email is not standard on most social networks — when a user friends someone they don’t then expect that person to be easily able to send that contact information to a third party along with hundreds of other addresses with just one click. In order to protect user privacy, we now exclude email addresses from the CSV export file. Of course users can still export their friend lists in the CSV file. In addition, Google Contacts syncs with Orkut, so users can export their Orkut friends’ email addresses from Google Contacts. We support web standards such as OAuth and are working on ways to help users share their data more securely between social networks. We believe strongly that users own their data, and we’re committed to finding ways to make it easier for users to export data.”

Google is right in that this isn’t a standard feature on most social networks, but most social networks aren’t busy touting things like the Data Liberation Front and reaping all the positive press associated with it. And if this is really a privacy issue, it doesn’t make sense that Google would let you export Email data through Google Contacts but not Orkut itself. Spammers looking to figure out how to harvest Email addresses will doubtless figure out the process. Of course, Orkut users looking to make the jump to Facebook probably won’t.

Vasconcellos also points out that Orkut’s tool is unncessarily hard to use, and he’s absolutely right. When I went to test out the friend exporter, I was fairly certain that it simply wasn’t working at all. That’s because every time you click on the ‘Export Contacts’ button the site kicks you back out to your homepage, and only shows the “take your contacts with you” section below the fold. It took me way too long to figure this out (I even tested the feature out in two different browsers). And I doubt most people will put in that much effort.

It’s understandable why Orkut would want to handicap the feature and make it hard to use, but Google can’t have it both ways: it’s either open, or it isn’t.

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According to comScore, Facebook had over 92 million unique visitors in August 2009 in the United States. Orkut had around 972 thousand unique visitors. Now, it would be one thing for Facebook to simply port the tool over to the US — after all, they’ve already got the tool built. But the social network is actually advertising it to its users in the United States (the ad takes you to the Orkut friend finder). Seems a bit vicious, doesn’t it? Like sucking the last few drops of life out of something that’s on its way out anyway.

Thanks to Nick Gonzalez for the tip.

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If that’s actually the case, here’s what I love about this:

1) Google says it was trying to add security features to improve Okrut Friends Export, yet it apparently didn’t bother to test the functionality after adding said feature. If they had, they would have immediately realized it was broken, like so many users did immediately. Google is a company meticulous about its testing of things, so that seems a bit odd.

2) The fact that Google would add additional security measures immediately following the revelation that Facebook had a tool it was promoting in India to allow users to easily import their Orkut friends is interesting. And by “interesting,” I mean suspicious. Does Facebook’s importing tool still work? Anyone in India, feel free to let us know in the comment.

I’m not saying this wasn’t, in fact, a bug. I’m just saying that the timing of said bug was interesting to say the least. And it certainly doesn’t seem like the usually careful Google cared very much about creating a bug that stopped the hemorrhaging of its Orkut users over to Facebook in India.

Sometimes “bugs” are convenient until you get called out on them. Just sayin’.

[photo: flickr/the consumerist]

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And that’s not all. Previously, even without the tool, it was pretty easy to export you contacts from Orkut into a CSV (comma separated value) file. But that’s no longer working either. The option still exists on the Friends page in Orkut, but when you click on it, and fill in the CAPTCHA, it simply redirects you to Orkut’s main page.

Coincidence? Maybe. But we’ve already gotten emails from users in India who saw our post and rushed to try and export their friend data to escape Orkut, only to be shot down. And let’s not forget that Google and Facebook have been down a similar road before. Last year, Facebook blocked Google’s Friend Connect from accessing the data on its network. This led to a silly he said/she said spat in which the users were the losers. Could this be payback?

Facebook is undoubtedly increasingly interested in India not only because it is the largest social network in the world, but thanks to Facebook Lite, it’s much more accessible to a wide range of people. Orkut, meanwhile, is, well, a social network that Google seems to talk about as little as possible.

To test the friend export functionality tonight, I logged into my Orkut account for the first time in what must be years. I was shocked to find that there were other people I knew actually on it, that Google was recommending that I friend. So I sent a few requests out, and within minutes, this is the reply I got back (over email):

“what the f**k?”

The message behind that being, “why are you using Orkut?” For some people in India right now, sadly, it appears that they have no choice.

I wonder what Google’s Data Liberation team thinks about this? I have a feeling the official word we’ll get back from Google is “bug.” But given the timing and the fact that two different ways to export your friends broke at once, I’m not so sure that the word they’re really looking for isn’t “hypocrisy.”

Update: As expected, Google is calling this a “bug.” Still, there some interesting things about this “bug.” And it’s not yet clear if Facebook’s Orkut importing tool is working again.

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With the growing market of internet users in the country, India has become a battlefield for social networks. Google-owned Orkut has long been the most popular social network in India, with Facebook fighting to catch up. But Facebook has been upping the ante over the past few months, and according to August’s ComScore numbers, the plan may be working. In August, Orkut’s unique visitors in India dipped by 800,000 within a month, from 16 million visitors in July to 15.2 million visitors in August. On the other hand, Facebook grew its unique visitors in India by 700,000, from 7.5 million visitors in July to 8.2 million visitors in August.

This the largest drop in unique visitors Orkut has seen in India over the past year, while Facebook has been steadily growing each month. In fact, Facebook’s audience in India is up 228 percent from a year ago, compared to a 35 percent annual gain for Orkut.

There are a couple of key factors that could be attributed to Orkut’s recent drop in visitors. First, in India, Facebook has been pushing out an aggressive campaign on its social network to get users to import their friends from Orkut with a special Orkut import tool. It basically lets them find friends on other social networks, like Orkut, who are also on Facebook and makes it easy to send a friend requests to those contacts. The purpose of the tool is to make it easy for users to quickly find new friends and establish their social presence on Facebook. The social network offers this in the U.S. for Gmail, AIM and other contact platforms. But this new tool in India is for Orkut specifically. Facebook users are also seeing is the Orkut contact importer in Brazil, Orkut’s home base and stronghold where Facebook is clawing for market share.

Another reason for Facebook’s growth in India could be the recent launch of Facebook Lite. India was one of the original target markets for the lightweight version of the social network, since it is particularly useful in developing countries where high speed Internet connections are sparse or non-existent.

Facebook has been eying India’s huge market and steadily adding features that help the social network establish its reach in the growing country. For example, Facebook launched availability for several Indian languages including Hindi, Punjabi, Bengali, Telugu, Tamil and Malayalam, in May of this year.

It’s plainly obvious that Facebook is growing fast in India and could quite possibly overtake Orkut in the next few months. Meanwhile, other social networks are dropping like flies in the race; with Yahoo shutting down SpotM and MySpace considering layoffs in India because of the its lack of traction among users.

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Yahoo India has decided to shut down SpotM, the social network it launched less than a year ago in India. According to the site, SpotM. which never exited private beta, will be shut down on Sep. 1. Yahoo launched SpotM as a social network for the 16-24 age bracket in an attempt to capture the growing market in India.

It appeared that SpotM had potential to take off due the popularity of social networks in India and the addition of a few differentiating features. Yahoo said that SpotM would allow users to make friends with other users and if they wanted, to make those friends private so other users wouldn’t know about the relationship. SMS integration with anonymous chat would let users correspond via SMS without revealing their phone number.

But it appears that SpotM couldn’t compete with other social networks that are dominating in India. Google’s Orkut is the leader in the space, with 16 million unique visitors in July, according to comScore stats. Facebook, which is growing incredibly fast in India, reached a high of 7.5 million unique visits in India, according to July’s comScore numbers. In May, Facebook launched availability for several Indian languages including Hindi, Punjabi, Bengali, Telugu, Tamil and Malayalam. Perhaps Yahoo is planning to focus its social networking efforts in other parts of the world with the recently launched Yahoo Meme.

Thanks to Ashish Sinha for the tip.

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Even on the Web, world dominance must be achieved one country at a time. While Facebook has long been the largest social network in the world, and should soon pass MySpace in the U.S., it is not the largest social network in every country. The map above created by Vincenzo Cosenza resembles more a game of Risk, with Facebook sweeping across the globe from the West.

Using Alexa and Google Trend data, Cosenza color-coded the map based on which social network is the most popular in each country. All of the light green countries belong to Facebook. But there are still pockets of resistance in Russia (where V Kontakte rules), China (QQ), Brazil and India (Orkut), Central America, Peru, Mongolia, and Thailand (hi5), South Korea (Cyworld), Japan (Mixi), the Middle East (Maktoob), and the Philippines (Friendster).

Apparently, Alexa already thinks that Facebook is larger than MySpace in the United States. And Maybe it is, or maybe Cosenza’s isn’t using the best data. But I love being able to visualize market dominance on acountry-by-country basis. I wonder what the map would look like using comScore data, some of which can be found in our recent social network valuation model.

Below is an interactive version of the map.

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We’ve now remodeled social network valuations based on current user numbers and Facebook’s most recent $10 billion valuation. The results are dramatically different.

Based on the original year-old model, if Facebook was worth $15 billion (their then-current valuation), MySpace, with far more U.S. users, was worth nearly $20 billion:

Our model takes Comscore data for available countries and regions. We’ve graphed each of 26 well known social networks with the data we have been able to collect. We’ve then calculated the average advertising spend (estimated by PriceWaterhouseCoopers in a recent report) for each person online in each of those countries. For example, in the U.S., the total 2008 estimated Internet advertising spend is $25.2 billion. We’ve divided that by the number of people online in the U.S. according to Comscore (191 million), to get an average Internet spend per person of $132. View the raw data and calculations here.

The U.S., by the way, is only the 4th most valuable market per Internet user, trailing The UK ($213), Australia ($148) and Denmark ($144).

We’ve then multiplied the average Internet spend per user in each market with the number of unique users each social network has in that market, essentially creating a “weighted average” based on the advertising dollars chasing users. If a social network has more users in the U.S., Japan, the UK, Germany, Australia, and other bigger advertising networks, they will have a higher weighted average valuation.

We believe this model is an effective way to rank various competing social networks. It bumps down networks like Orkut and Friendster who have tens of millions of users in markets with very little advertising spend, and bumps up networks with lots of users in higher value markets.

Based on this model, MySpace is by far the most valuable social network. Second place Facebook has just 75% of the value of MySpace (even though it now has more users), followed by Bebo (26% of MySpace value), Hi5 and Amebio. LinkedIn comes in at no. 11, at 6% of MySpace’s value.

The new model takes into account the dramatic rise of Facebook usage over the last year, the massive recent decline in MySpace usage, and less dramatic changes in the other social networks. We’ve also modeled out the various valuations with the old Bebo ($850 million) and LinkedIn ($1 billion) valuations as pivot points. We’ve also added Twitter to the list just for kicks.

The bottom line: If Facebook is worth $10 billion today, MySpace is worth just $6.5 billion. Bebo is worth $1.8 billion, Twitter is worth $1.7 billion and LinkedIn is worth $0.8 billion. Facebook also accounts for 37% of all social networking value points in our model. Another way of saying this: If Facebook is worth $10 billion, the value of the entire social networking industry is $27.1 billion.

Lots of charts and graphs below. The full model is here if you want to look at all the data (I recommend zooming unless you have super vision). Thanks to TechCrunch intern Dan Romero for running the new model.

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Year end Comscore numbers for the U.S. audience are out. The first thing we checked? How the major social networks are doing.

Facebook, which became the largest worldwide social network in mid 2008, is still playing catch up to MySpace in the U.S. They have 54.5 million monthly unique visitors, says Comscore, compared to nearly 76 million for MySpace. But Facebook’s growth rate in the U.S. averaged 3.8% per month over the last twelve months. MySpace’s U.S. growth rate is 0.8% per month. That’s nothing to be ashamed of, but unless things change a lot, Facebook will overtake MySpace to become the largest social network in the U.S. in…2010.

At current growth rates Facebook will overtake MySpace in January 2010, a year from now. That is the month Facebook will reach 86 million U.S. users, compared to MySpace’s 84 million in January. Will this prediction be correct? Probably not, but it’s the best guess given today’s data.

It may actually take longer. Facebook’s growth rate had been increasing as the year wore on but dipped in December. As they get closer to MySpace it may become ever harder to catch up.

Also, even though Facebook is more than 2/3 the size of MySpace in the U.S. today, some key engagement metrics show more activity per user at MySpace. MySpace has almost two times the total time spent (17.5 billion minutes v. 9.3 billion minutes). MySpace generated 40 billion page views in December to Facebook’s 18 billion.

More data for other social networks is in the chart. Ning, starting from a smaller base, leads in overall growth rate, at 388% for the year and 14.1% monthly. Classmates is also growing quickly in the U.S. and had 16.6 million monthly unique visitors in December.

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What were the top social media sites of 2008? ComScore came out with its worldwide traffic stats for November a few days ago (so these don’t include December). They are a mix of social networks and blogging platforms. Blogger, the orange line in the chart above, still rules the roost with an estimated 222 million unique worldwide visitors in November (up 44 percent from November, 2007). Facebook, the blue line, is on pace to pass it soon with 200 million unique visitors (up 116 percent). (Note, though, that this is more than the 140 million active users Facebook itself reports—go figure). MySpace is pretty steady at 126 million uniques. Wordpress is a close fourth and gaining with 114 million (up 68 percent). And Windows Live Spaces is down 22 percent to 87 million uniques.

ComScore keeps a list of what it calls “social networking” sites, but these include blogging platforms and other social media sites as well. While the audience for blogs is still showing healthy growth overall, Facebook stands out as the social gorilla taking share from not only other social networks but blogs and other social media as well.

Below are the top 20 sites on comScore’s social networking list. It is really more of a social media site list, which is what I’m renaming it for this post. It is not definitive, but it gives a good lay of the land. (Here is a similar ranking from 2007). Note on this list the stubborn persistence of Yahoo’s Geocities at No. 6, the rise of Yahoo’s Flickr at No. 7, Six Apart at No. 10, and the presences of Chinese sites like Baidu Space and 56.com. The real surprise, though, is document-sharing site Scribd at No. 16, with nearly 24 million worldwide uniques.

Top Social Media Sites (ranked by unique worldwide visitors November, 2008; comScore)

1. Blogger (222 million)
2. Facebook (200 million)
3. MySpace (126 million)
4. Wordpress (114 million)
5. Windows Live Spaces (87 million)
6. Yahoo Geocities (69 million)
7. Flickr (64 million)
8. hi5 (58 million)
9. Orkut (46 million)
10. Six Apart (46 million)
11. Baidu Space (40 million)
12. Friendster (31 million)
13. 56.com (29 million)
14. Webs.com (24 million)
15. Bebo (24 million)
16. Scribd (23 million)
17. Lycos Tripod (23 million)
18. Tagged (22 million)
19. imeem (22 million)
20. Netlog (21 million)

Here’s a screenshot of the actual data (as you can see, I rounded above):

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According to the Brazilian news magazine Exame, Google has made Brazil the center of its Latin American operations, placing former country director Alexandre Hohagen at the helm.

Google is understood to have chosen Brazil for its superior regional performance. While the Mountain View, California-based search giant doesn’t comment on regional numbers, the article claims that Brazil is Google’s fastest growing market (hard to verify, but it’s certainly one of the fastest growing), generating an estimated $500 million per year in revenues. This is all the more impressive considering the Brazilian office was opened just three years ago and has only 200 employees.

The decision to run Latin American operations from Brazil comes soon after another decision to move all development and management of Orkut to that country, with most of the engineering in the city of Belo Horizonte. Orkut is Google’s social network, which enjoys most of its popularity in Brazil and India.

Brazil is also said to have the second largest number of Gmail accounts, perhaps because of the popularity of Orkut. Google’s biggest white labeled Gmail customer may also be in Brazil: iG, a portal with over 9 million accounts.

Google is still in the process of replacing Hohagen with a new country director for Brazil.

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It’s time to start comparing the big global social networks on something other than unique visitors and page views. I believe an effective way to value a particular user is based on the average Internet advertising spend per person in the country they live in. The higher the spend, the more value the social network can get out of the user by serving them advertising and other products. That means that, for now, users in a handful of key countries are worth far more in terms of revenue potential than those in the rest of the world.

We’ve begun to build out a model that looks at social network usage by country/region and compares that to available data on total Internet advertising spend in each of those countries. The model is then able to turn an apples-to-oranges comparison into an apples-to-apples comparison. The early results are surprising.

The ultimate financial value of any asset is, ultimately, what the market will pay for it. We have only a few data points to help us: Facebook, Bebo and LinkedIn are worth $15 billion, $850 million and $1 billion, respectively, based on relatively recent valuations (although only Bebo was actually sold completely; Facebook and LinkedIn raised investments at those valuations). The last valuation of MySpace was just $580 million, back in 2005 when it was acquired by News Corp.

Which valuation is most “correct?” It’s hard to say based on the data that’s been available to date, which is mostly just aggregate page view and unique visitor numbers from Comscore and other services. Based on worldwide unique visitors, for example, Facebook recently overtook MySpace to become the “largest” social network.

According to raw worldwide user number, the biggest social networks are Facebook, Myspace, Hi5, Friendster, Orkut and Bebo, in that order. But when you apply the model that we’ve created below, which takes into account where users live, the rankings change substantially. MySpace is by far the most valuable social network based on available data. A competitor like Orkut is worth only 1/20th of MySpace, even though it has nearly 1/4 the number of users.

Properly Ranking Social Networks

Our model takes Comscore data for available countries and regions. We’ve graphed each of 26 well known social networks with the data we have been able to collect. We’ve then calculated the average advertising spend (estimated by PriceWaterhouseCoopers in a recent report) for each person online in each of those countries. For example, in the U.S., the total 2008 estimated Internet advertising spend is $25.2 billion. We’ve divided that by the number of people online in the U.S. according to Comscore (191 million), to get an average Internet spend per person of $132. View the raw data and calculations here.

The U.S., by the way, is only the 4th most valuable market per Internet user, trailing The UK ($213), Australia ($148) and Denmark ($144).

We’ve then multiplied the average Internet spend per user in each market with the number of unique users each social network has in that market, essentially creating a “weighted average” based on the advertising dollars chasing users. If a social network has more users in the U.S., Japan, the UK, Germany, Australia, and other bigger advertising networks, they will have a higher weighted average valuation.

We believe this model is an effective way to rank various competing social networks. It bumps down networks like Orkut and Friendster who have tens of millions of users in markets with very little advertising spend, and bumps up networks with lots of users in higher value markets.

Based on this model, MySpace is by far the most valuable social network. Second place Facebook has just 75% of the value of MySpace (even though it now has more users), followed by Bebo (26% of MySpace value), Hi5 and Amebio. LinkedIn comes in at no. 11, at 6% of MySpace’s value.

Valuation Ranges

The real-world revenue numbers being reported for the big networks supports this approach to valuation and shows a direct tie between monetization efforts and where a network’s users are. MySpace is estimated to have generated $755 million in revenue over the last year. The (now) larger Facebook, with a far higher percentage of users in less lucrative markets, will generate just $255 million this year:

EMarketer estimates that MySpace will post $755 million in revenue in the fiscal year ending June 30. MySpace would not comment on the estimate. About a third of the revenue is expected to come from the Google ad pact. For the year, Facebook is estimated to earn $265 million in ad revenue.

Since we have three recent data points valuing social networks (Facebook at $15 billion, Bebo at $850 million, LinkedIn at $1 billion), we can start to apply valuation ranges based on the model. Facebook’s 10.2 million value points and $15 billion valuation puts a $1,467 value on each value point. LinkedIn is valued very similarly, at $1,325 per value point. Bebo, with lots of users in the rich UK market, appears to have been undervalued at only $241 per value point.

Based on these three publicly available data points we’ve created value ranges for each of the top 25 worldwide social networks. There is a very wide disparity (MySpace, for example, is worth between $3.3 billion and $20 billion, based on which comparable you look at). But it does yield very interesting data. For example, If Facebook and LinkedIn were valued similarly to Bebo, they would be worth just $2.5 billion and $182 million, respectively, far less than what their investors recently paid for a piece of them.

Interestingly, the recent sale of Polish social network Nasza-klasa for $92 million appears to be right in sync with Bebo’s price. The model estimates its value at $91 million based on Bebo’s valuation metrics.

There are some big flaws with the model and analysis in its current state. First, LinkedIn may be in a different class of network, given that all of its users are business focused (no super-poking going on there). As a result, it may be able to monetize users far better than its competitors, no matter what geographic market is being looked at. Still, we’ve decided to leave it in as a data point, with that caveat.

The model itself needs more data. The user numbers are based on April Comscore. We will shortly revise it with the May numbers, although the absolute rankings probably won’t change. More importantly, some big markets are not included yet. The Chinese Internet advertising market, for example, is estimated to be $2 billion in 2008, yet they are not included (mostly because I can’t find data on user numbers for the networks). Also, the Philippines isn’t broken out separately, again due to data availability issues (although the total Internet advertising market in the Philippines is just $3 million this year, so it won’t affect the rankings materially even though Friendster is so strong there). Finally, Russia is currently grouped with “the rest of Europe,” and needs to be separately broken out – it has a large and growing online advertising market and lots of users, so that update may affect the mid-level network rankings.

The advertising spend model is just an estimate and from a single source. I’m less concerned with this data since it doesn’t matter to the model if the estimates are absolutely correct. If the estimates are wrong by different rates in different countries, however, the model will break. If we find better relative data between countries, we’ll update the model with that data. But for now, the PriceWaterhouseCoopers data seems to be pretty good.

Finally, this model doesn’t take into account execution at the company level. Two very similar networks may monetize vastly differently based on methods of advertising and even the brute effort and passion of the employees. This model obviously doesn’t take that into account.

I also note Andrew Chen’s analysis last week which takes a similar approach to this using Google Trends data instead of Comscore. The Google data isn’t granular enough to really dig in to relative values, however, and he was lacking current and deep data on average Internet spend. Still, I agree with his methodology.

As I wrote at the very end of this post, you have to consider the current monetization value of users when comparing social networks. Raw user numbers are pointless without it.

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In the U.S., though, which is the biggest advertising market, MySpace is still well ahead of Facebook, with 73.7 million unique visitors in May compared to 35.6 million for Facebook. And that number for MySpace is up 2 percent from April, whereas Facebook’s had 0 percent growth. So it remains to be seen if and how fast Facebook can catch up in the U.S.

As for the second-tier social networks, they have fewer than half as many visitors. Here is the breakdown for May:

Worldwide Unique Visitors To the Top Social Networks

Facebook—123.9 million
MySpace—114.6 million

Hi5—49.6 million
Friendster—38.1 million
Orkut—32.2 million
Bebo—25.1 million

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If you try to buy an ad on Facebook, there are certain words that are taboo. Any ads that contain four-letter words are automatically blocked. So too are ads with the names of competing social networks “MySpace,” “Friendster,” “Hi5,” , or “Orkut.” (Curiously, “Bebo” and “OpenSocial” go through just fine, as does “Microsoft,” “Yahoo,” “Google,” and “AOL”).

Okay, so Facebook doesn’t want to run ads for some of its competitors. But why is 3Jam blocked? The startup offers an SMS service that lets people send multiple text messages at once, and it even has a Facebook app that does the same thing.

CEO Andy Jagoe was befuddled when he tried to create a Facebook ad to test a new product, only to find out that the term “3Jam” was also blocked. (The product actually sounds pretty cool: it will be a way to send and receive text messages for free while you are online, and then route them to your phone when you are offline). Says Jagoe:

It seems crazy to think that they consider us competitive. This is kind of weird. It is like censorship.

It does seem weird. What other startup names or products are blocked by Facebook?

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In February A Moroccan man was arrested for pretending to be the Moroccan king’s younger brother, Prince Moulay Rachid, on Facebook. Facebook complied with Morrocca information requests about the man, leading to his arrest. The man was granted a royal pardon after his sentencing, and was out of jail by mid March.

Today we’re hearing of another arrest, this time in India. 22-year-old IT professional Rahul Krishnakumar Vaid. His crime was writing in an orkut community named “I hate Sonia Gandhi.” Sonia Gandhi is a prominent politician in India.

Vaid was charged under section 292 of Indian Penal Code and section 67 of the Information Technology Act because he created a profile and then posted content in vulgar language about Sonia Gandhi in the community.

During investigations, the cyber crime cell of Pune police communicated with Google (which owns Orkut) seeking details about the man who formed this forum and circulated the obscene content. It was known that the vulgar message about Sonia Gandhi was circulated through an email address – Rahulvaidindia@gmail.com . The owner of the email id Rahul Vaid was traced, using information supplied by Google, to Chakarpur in Gurgaon city of Haryana.

He was then charged under section 292 of Indian Penal Code and section 67 of the Information Technology Act because he created a profile and then posted content in vulgar language about Sonia Gandhi in the community. If he’s convicted, he can be imprisoned for up to five years and may have to pay a fine up to Rs one lakh.

This is an issue that needs to be addressed everywhere, but the hot spots right now are areas where extreme laws make what would be legitimate actions in the US or Europe into fairly serious crimes in their jurisdictions. Our companies have to decide if they’ll defy the law and take the consequences. On the upside, users will flock to them knowing their data is secure.

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MySpace launched Data Availability on Thursday, a competing product. Yesterday, in a suspiciously timed pre-release announcement, we heard about Facebook Connect, another similar product (with a nearly identical name to Google’s Friend Connect).

Like Data Availability and Facebook Connect, Google’s Friend Connect will be a way to securely send personal profile data, including friend lists, presence/status information, etc., to third party applications, say our sources. The primary benefit of these services is to allow users to maintain a single friends list and to coordinate social activities across different sites that perform different services. See my post on the Centralized Me for more of my thoughts on this.

The reason these companies are rushing to get products out the door is because whoever is a player in this space is likely to control user data over the long run. If users don’t have to put profile and friend information into multiple sites, they will gravitate towards one site that they identify with, and then allow other sites to access that data. The desire to own user identities over the long run is also causing the big Internet companies, in my opinion, to rush to become OpenID issuers (but not relying parties).

If what we hear is correct, Google’s offering may not be as attractive as MySpace’s and Facebook’s. Google may be keeping a tighter reign on data, requiring third parties to show it directly from Google’s servers in an iframe. By contract, MySpace and Facebook are sending data via an API and trusting third parties not to abuse it (with strict terms of service in case they violate that trust). That flexibility also allows those third parties to do more with the data, including combining it with their own data before displaying it.

We’ll have to wait until Monday for the exact details, though. But what’s clear is that Google wants to get in between social networks and the web sites that want to access their data. By controlling the flow through Open Social and the new Friend Connect product, they can effectively become a huge social network without actually having a, well, social network (unless you count Orkut).

Google’s been scrambling for partners to announce on Monday as well. So far our understanding is they have their own Orkut and Plaxo. Compare that to MySpace (Yahoo, eBay and Twitter, plus their own PhotoBucket) and Facebook, which announced Digg as an early partner.

Another limiting factor with Google’s product is that, unlike Facebook and MySpace, they do not already control user profiles for tens of millions of active users. That means they’ll quickly need to get big partners on board as well. Will MySpace help them? They may – MySpace is already part of Open Social and said on Thursday that they will adopt Open Social initiatives in this space once they are defined. We’ll see.

More details as they come in.

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While MySpace and Facebook are fighting it out for the top spot, back in the second pack some interesting sprints and scuffles are going on that are worth keeping an eye on. Everyone in that second pack (Hi5, Freindster, Orkut, Bebo, Imeem) are about a third to a quarter the size of the leaders in terms of worldwide unique visitors, so I’ve isolated their performance in the chart above (it is harder to see if you include Nos. 1 and 2, MySpace and Facebook).

In January, both Hi5 (No. 3, in red) and Friendster (No. 4, in blue), made moves to pull away from Google’s Orkut (No. 5, in green) and Bebo (No. 6, in yellow). The latter two maintained a more steady pace. Coming on strong from behind is Imeem (No. 7, in purple), which surpassed Multiply (No. 8, not shown). The chart below has most of the stats, except for the last two—Imeem had 17.8 million global visitors in January, 2008, a 477 percent annual growth rate (Multiply had 17.6 million, a healthy 203 percent rise from the year before).

For Hi5 and Friendster, global growth is a major part of their game plan. Friendster, for instance, which dropped off the radar for most of us in the U.S., is now the single largest social network in Asia. It’s top five countries are the Philippines, Indonesia, Malaysia, the United States (legacy members who never left, plus new growth among Asians here), and Singapore. Friendster has kept its growth going by launching fan profile pages for Asian pop singers, launching four new languages since September (Chinese, Japanese, Korean, and Spanish), and letting developers create apps for its site.

So does that mean that Friendster and Hi5 are worth more than the $1 billion Bebo is rumored to have sold itself for? Not necessarily. It depends on the actual composition of their members, click-through rates, and other financial factors. Generally speaking, advertisers like to target their campaigns by geography, and pay less for ads that target populations with lower per-capita spending power than in the U.S., Japan, or Europe. So not all members are worth the same to advertisers, and thus to potential acquirers. But as social networks become saturated here in the U.S., everyone will have to look overseas to keep growing.

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Buenos Aires based Sonico from FNBox launched in August 2007 with the usual social networking mix of message boards, profiles and networks based on school or workplace. Nothing remarkable, until you look at the numbers.

Sonico now has over 8 million registered users, and has recently launched a Portuguese version as well (so as to cover the rest of South America). According to Alexa the site now ranks at 167, and is in the top 50 sites in Colombia, El Salvador, Bolivia, Ecuador, Paraguay, Guatemala, Nicaragua, Peru, Honduras, Panama, Chile, Venezuela, Dominican Republic, Argentina, Cuba and Mexico. We can only get the worldwide figures from comScore and although it’s still below the leading second tier social networking sites, it’s still placed extremely well for a site that is just 6 months old.

Targeting the South American market is in vogue at the moment with players such as MySpace and Facebook now offering Spanish language versions, and smaller players such as Wamba trying to get a foot hold in a continent that has a growing online user base. Google’s Orkut is already big in Brazil and Hi5 is also popular locally. If their current growth continues Sonico will be a site to watch.

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In fact, not long after I originally posted about the MySpace deal earlier today, I received the following statement from Facebook:

Facebook has always created an inhospitable environment for predators by limiting access to users’ personal information based on real-world social connections. We have led the way in our partnership with the New York Attorney General and continue our involvement with the Attorneys General of all states and other law enforcement agencies to keep children safe from those who would do them harm. We are happy to work further with the states to develop and deploy strategies to protect kids online.

I am pretty sure that not only Facebook, but also Bebo and Google, will do whatever is necessary to fight sexual predators. With that in mind, here specifically is where Facebook, Bebo and Orkut (i.e., Google) are now lagging MySpace in protections for younger users, and where they may have to spend money to catch up:

Update: See clarifications/corrections from Facebook below in italics:

1. IMAGE AND VIDEO REVIEW

MySpace proactively reviews videos and images for pornographic and sexually inappropriate content. Humans look at every image and banned images are digitally fingerprinted to prevent them from being uploaded again.

Facebook and Bebo only ban inappropriate images and video that are reported by users. Orkut doesn’t even do that.

Facebook has automated examination working on video, but they find that reports work extraordinarily well in removing inappropriate content quickly – for both images and video. They have always had report links, which MySpace was forced to add under this agreement.

2. GROUPS REVIEW

MySpace monitors group discussions for predatory content.

Facebook and Bebo regulate only reported incidents. Orkut does not review group discussions.

Re: Groups, Facebook has algorithmic monitoring for inappropriate names/themes and a variety of technical tools that automatically cull them.

3. SEX OFFENDER DATABASE

MySpace helped develop and fund a database of registered sex offenders and deletes the accounts of members who are registered sex ofenders.

Facebook, Bebo, and Orkut do not have a policy of automatically removing registered sex offenders.

Facebook has a policy of removing convicted sex offenders, and has a proposal to do real-time checks of official state databases pending with the Attorneys General for nearly a year.

4. AGE LIMIT ENFORCEMENT

MySpace algorithmically searches for underage members and deletes their accounts.

Facebook and Bebo are more reactive in their underage account deletion policies. Orkut does not enforce any age limits.

On age checks, users under 18 years of age are required to designate a high-school network and Facebook places a cookie blocking site access on the browser of anyone who attempts to sign up with an under-13 birth date.

5. “FRIEND” PROTECTION FOR YOUNGER USERS

On MySpace, older users cannot contact underage users without first knowing their e-mail and full name.

On Facebook, Bebo, And Orkut, anyone can “friend” anyone else.

Facebook also separates under-18 profiles in networks outside of schools, limits visibility to only under-18s within that network by default, and provides settings to restrict visibility and searchability even further.

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* Building both showcase and canvas views, with Apps having the ability to create multi-page experiences in the full page canvas view.

* Foster communication among friends by allowing access a user’s profile information, friend list, and an update feed so that people can see what their friends are up to.

* Learn once, write everywhere as apps written for Orkut under OpenSocial can be used to build social apps for other websites.

The OpenSocial team also has a blog here.

Orkut joins Plaxo, and possibly tonight Ning as being the first sites with OpenSocial support.

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MySpace and Six Apart will announce that they are joining Google’s OpenSocial initiative. Silicon Alley Insider reported the MySpace rumor earlier today. We’ve confirmed that from an independent source, as well as the fact that Six Apart is joining. Per the update below, Google has also confirmed Bebo is joining.

Google will be making an announcement today. MySpace and Six Apart join Orkut, Salesforce, LinkedIn, Ning, Hi5, Plaxo, Friendster, Viadeo and Oracle as announced Google partners. No word on whether MySpace will continue with efforts to complete its own recently announced platform, but the answer is probably yes. They are likely to simply do both (Update: see below).

Suddenly, within just the last couple of days, the entire social networking world has announced that they are ganging up to take on Facebook, and Google is their Quarterback in the big game.

Update (12:30 PST): On a press call with Google now. This was embargoed for 5:30 pm PST but they’ve moved the time up to 12:30 PST (now). Press release will go out later this evening. My notes:

On the call, Google CEO Eric Schmidt said “we’ve been working with MySpace for more than a year in secret on this” (likely corresponding to their advertising deal announced a year ago).

MySpace says their new platform efforts will be entirely focused on OpenSocial.

The press release names Engage.com, Friendster, hi5, Hyves, imeem, LinkedIn, Ning, Oracle, orkut, Plaxo, Salesforce.com, Six Apart, Tianji, Viadeo, and XING as current OpenSocial partners.

We’re seeing a Flixster application on MySpace now through the OpenSocial APIs. Flixster says it took them less than a day to create this. I’ll add screen shots below.

Here’s the big question – Will Facebook now be forced to join OpenSocial? Google says they are talking to “everyone.” This is a major strategic decision for Facebook, and they may have little choice but to join this coalition.

Bebo has also joined OpenSocial.

Flixster/MySpace screen shots:

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What they haven’t done is launch yet another social network platform. As more and more of these platforms launch, developers have difficult choices to make. There are costs associated with writing and maintaining applications for these social networks. Most developers will choose one or two platforms and ignore the rest, based on a simple cost/benefit analysis.

Google wants to create an easy way for developers to create an application that works on all social networks. And if they pull it off, they’ll be in the center, controlling the network.

What They’re Launching

OpenSocial is a set of three common APIs, defined by Google with input from partners, that allow developers to access core functions and information at social networks:

• Profile Information (user data)
• Friends Information (social graph)
• Activities (things that happen, News Feed type stuff)

Hosts agree to accept the API calls and return appropriate data. Google won’t try to provide universal API coverage for special use cases, instead focusing on the most common uses. Specialized functions/data can be accessed from the hosts directly via their own APIs.

Unlike Facebook, OpenSocial does not have its own markup language (Facebook requires use of FBML for security reasons, but it also makes code unusable outside of Facebook). Instead, developers use normal javascript and html (and can embed Flash elements). The benefit of the Google approach is that developers can use much of their existing front end code and simply tailor it slightly for OpenSocial, so creating applications is even easier than on Facebook.

Applications can have full functionality on profile and/or canvas pages, subject to the specific rules of each host. Facebook, by contrast, limits most functionality to the canvas page, allowing a widget on the profile page with limited features.

OpenSocial is silent when it comes to specific rules and policies of the hosts, like whether or not advertising is accepted or whether any developer can get in without applying first (the Facebook approach). Hosts set and enforce their own policies. The APIs are created with maximum flexibility.

Launch Partners

Partners are in two categories: hosts and developers. Hosts are the participating social networks, and include Orkut, Salesforce, LinkedIn, Ning, Hi5, Plaxo, Friendster, Viadeo and Oracle.

Developers include Flixster, iLike, RockYou and Slide.

What This Means

The timing of OpenSocial couldn’t be better. Developers have been complaining non stop about the costs of learning yet another markup launguage for every new social network platform, and taking developer time in creating and maintaining the code. Someone had to build a system to streamline this (as we said in the last few sentences in this post). And Facebook-fear has clearly driven good partners to side with Google. Developers will immediately start building on these APIs to get distribution across the impressive list of hosts above.

And they’ll do it soon, too. It’s clear that the developers who arrived early to the Facebook Platform party won easy customers. Those that came later had to fight much harder. Developers found their new gold strike, and they will soon all be there, mining away.

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Key facts from the article: Orkut is 1/4 the size of MySpace (Comscore shows a much closer race), but they’ve recently taken the lead in the Asia/Pacific region. Orkut is also very strong in Latin America, with double the traffic of MySpace and Facebook combined.

Business Week also confirms our estimated November 5 launch date for a new set of APIs which let developers build applications that span a number of Google services. We heard the from sources here in Silicon Valley; their sources are third-party developers based in India.

Google plans to open up Orkut as a Platform, with fewer restrictions than Facebook. As an example, they say, application developers may be able to host applications on their own servers (Facebook does not permit this). Other Google services will be made available as well “If the plan succeeds, users might begin to see applications combining Orkut with Google Maps that would show where friends are located.”

And the article is also confirming that Google is thinking beyond their own properties, too. “For example, an Orkut widget for Facebook might enable Facebook users to see whether their Orkut friends are online through their Facebook pages.”

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