- Adweek Staff

NEW YORK MySpace is still the leading social networking site when it comes to ad spending in the U.S., but its fortunes have changed dramatically over the past few months.

News Corp. executives said in a May 6 conference call with financial analysts that ad revenue fell 16 percent at Fox Interactive Media (FIM) in the January-March 2009 quarter, compared with the previous year. And MySpace makes up the bulk of FIM's revenue.

And the trend is decidedly downward.

eMarketer projects that U.S. ad spending on MySpace will reach just $495 million this year, down 15 percent from the estimated $585 million MySpace generated in 2008.

The challenges facing MySpace do not necessarily mean that other companies operating in the social network space will face similar problems.

Facebook, for example, is expected to increase its U.S. ad revenue 9 percent in 2009 to $230 million, while U.S. ad spending on widgets and applications is projected to reach $70 million, up 75 percent from 2008 (albeit from a very small base).

U.S. spending on all other social networking sites combined is expected to rise 1 percent to $345 million.