Advertising company's SocialMedia.com CEO Seth Goldstein announced a collaboration with MySpace meant to create and use what they call 'Interaction Ads', which will utilize MySpace's internal data along with MySpace members’ own input to provide their friends with customized targeted ads.

These types of ads have been seen before having been launched by SocialMedia.com in early spring and called Friend to Friend social ads. They work by asking you a question, say, related to your favorite musical style, and then having your answer along with the question shown to your friends in the ads they see. This will make it much more likely for them to get involved and pay attention to it. Their answer would also be passed along to their friends adding a sort of viral component to the campaign.

At first users may be surprised by this type of customization but results so far seem very promising for companies using the ads in campaigns so they might get very popular over the next few years. However the advertizing company notes that users will be allowed to disable this functionality if they wish so.

The new deal with MySpace could be very important for SocialMedia.com as the social networking giant is still the biggest in the US, even if Facebook is set to overtake it anytime now. And Facebook may be getting a lot of the attention lately but MySpace isn't going anywhere for now. And just like Facebook and every other social network out there, it is always looking for new ways to earn revenue. With a new Google deal not likely to happen, MySpace will have to find new income sources, so the deal may be just as important to both parties involved. This is why it is not surprising that SocialMedia.com is working together with MySpace to provide a customized product, not just to buy advertising space.