MySpace's Revenue Problems

A lot is said about Facebook, its lack of profits and the problems it faces as the advertising market declines. Things are no different for MySpace (s nws), as this little nugget from a research report published by J.P. Morgan shows:

Digital strategy is not working. MySpace revenue was flat Y/Y and FIM OI declined to $7M from $47M in Q2 FY08. MySpace continues to face challenges monetizing its large audience. We see more headwinds ahead as remnant inventory pricing is declining and competition makes it more difficult to reach meaningful profitability. Additionally, we are concerned that economics of search will worsen significantly when the deal with Google ends in Q4 FY10 creating additional pressure on profitability.

Fox Interactive Media in the most recent quarter posted revenues of $226 million, down 3 percent over the same quarter a year earlier; operating income was $7 million. They do have some issues.