News Corp. (NWS): Trouble in MySpace-ville

Fox Interactive Media, the internet arm of News Corp. (NYSE: NWS), is reorganizing due to a shortfall in revenue. According to TechCrunch, "The company, under President Peter Levinsohn, will miss their revenue target of $1 billion for the current fiscal year ending June." The miss could be as much as $100 million. Several of the top sales and marketing people at the unit will be moved or replaced.

The news indicates how hard it is to make money on social networks like News Corp's MySpace and photo-sharing property Photobucket. Unlike portal sites, social networks are a patchwork of content created by users and are hard to break into content categories like financial, autos, or music the way that advertisers like to target their messages.

The revenue miss also begs the question of whether the other large social network, Facebook, is worth anywhere near the $15 billion valuation it was given recently in a round of fund-raising.

Social networks may simply be good for users but awful for marketers.

Douglas A. McIntyre is an editor at 247wallst.com.