Going, going ... MySpace may sell for one-third of what Murdoch paid for it
Rupert Murdoch was hailed a far-sighted genius when he plonked down $580 million for social network MySpace. So what went wrong and why is it now for sale at a knockdown price?
Jonathan Miller, head of the Corp.’s digital media group told a media conference in Abu Dhabi that the company had started a process to decide on the future of MySpace “in earnest.”
News Corp. paid $580 million for MySpace in 2005. In June 2006 it was being hailed as "America's Number 1 social network " capturing 80% of social networking traffic. Facebook was second with 7.6%.
So what went wrong for MySpace? Redesigns and difficulty using the site may be at the heart of it. Commentator Kate Ashton-Butler wrote, "It would take an extremely alert astro-physicist to cut through the sheer amount of cyber-babble bullshit on the site and eventually work out how to use this mind-boggling excuse for a social network."
News Corp may end up selling the company, based in Beverly Hills, California, for "$50 million to $200 million," according to MocoSpace, a potential buyer. MocoSpace said last month that News Corp. had agreed to talks about a possible sale.
MySpace has long since been surpassed by social-networking rival Facebook now with 500 million users. In January, MySpace said it would cut about 500 jobs, or 47 percent of its workers, as part of a broad restructuring.