It seems like challenges in monetizing social networks is hitting home.
They are expected to see slowed ad growth acording to a report from eMarketer.
Advertising-spending growth on social networks is going to take a major hit amid the recession and the sites’ continued struggle to develop effective ad models, according to a new report from research firm eMarketer.
The firm plans to release on Wednesday its revised projections for global ad spending on social networks. It forecasts an increase this year of 17%, to an estimated $2.3 billion. While any growth in the otherwise dismal ad market is a bright spot, the projection is just over half the 32% growth rate the research firm previously projected. In the U.S., ad spending on social networks is expected to increase 10.2%, reaching $1.3 billion this year.
There are rumours that there will be ’sizable’ layoffs coming to Myspace.
Pali Research analyst Rich Greenfield says “sizable layoffs” are coming to Fox Interactive. Mostly this has to do with Google being unlikely to renew its search deal with the News Corp. (NWS) property when it expires in 2010.