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MySpace lays off 425 employees [UPDATED]

UPDATED:

News Corp.'s struggling social network MySpace said it would lay off nearly 30% of its staff -- or about 425 people -- as part of a plan to restructure the business.

VANNATTA “Simply put, our staffing levels were bloated and hindered our ability to be an efficient and nimble team-oriented company,” said MySpace Chief Executive Officer Owen Van Natta. “I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace.  Our intent is to return to an environment of innovation that is centered on our user and our product.”

When Rupert Murdoch struck a deal to buy MySpace for $580 million in 2005, he was hailed as a a new media visionary, the mogul who got the Internet. News Corp. had out maneuvered rival Viacom for the site, which so annoyed Sumner Redstone that he pushed out his CEO Tom Freston.

RUPERT Soon after the MySpace deal, Murdoch told Wired Magazine that the Internet "is media's golden age." That's yet to be proven but later in the interview he was a little more prescient. "God knows what we're going to do with MySpace," he said.

Now four years later that's what everyone else is wondering that as well. Facebook has surpassed MySpace as the top social network site in the United States. It has little buzz anymore and its advertising revenue has dropped over the last year. Its groundbreaking $900-million advertising deal with Google ends next year and that revenue will be hard to replace.

Inside News Corp., integrating MySpace into the rest of the spawling media company has proven a challenge. MySpace has never become the platform for News Corp. content that many thought it would be when it acquired the company. MySpace co-founder Chris DeWolfe often clashed with other executives and left the company last spring, succeeded by Van Natta, Facebook's former chief revenue officer.

Bringing MySpace back to the top may be a steep challenge for Van Natta and Jonathan Miller, News Corp.'s new chief digital officer. Unlike television where everyone is one hit away from returning glory, social network sites that start to fade tend to keep fading. Anyone remember Friendster?

--Dawn C. Chmielewski and Joe Flint

Photos: Top left: Owen Van Natta, courtesy News Corp. Bottom right: Rupert Murdoch. Credit: Vince Bucci, Getty Images.

 
Comments () | Archives (7)

put a fork in it - it's dead

myspace? I my opinion it's over... I have not logged in for well over a year now. The site just became so .... "Promotional".

Man, I hate to say this but I saw it coming long ago. Let's keep in touch on Facebook now in the "ex-MySpace" group

http://www.facebook.com/group.php?gid=110502932914&ref=mf

no its not. it just started.

Here's the issues for Myspace.

1. There are almost no barriers to entry. It's not like launching a print magazine in the old days when there were all sorts of costly issues that needed to be worked out. In the internet age, everyone is empowered to create a better mouse trap, and the media moguls of the world no longer have nearly as much (if any) control like they used to. Therefore, a
Facebook can come along and overtake a Myspace very quickly.. and something else might overtake Facebook in the future.

2. The service is too easily duplicated, and this doesn't really need further explanation.

2. There's a sleeze factor to Myspace where I feel like I'm looking at some sort of porn or raunch when I've logged into it. Facebook is a much more family friendly and clean. I don't need to be associated with any sort of sleeze which is why I stopped using Myspace, not that I ever did except to try it out. Myspace is also much harder to use imo, I couldn't seem to figure out some basic things w/o spending a lot of time. Facebook is a breeze.

3. Where's the revenue? Giving away free services and chasing increasingly diffuse ad dollars is a tough proposition. Advertisers have more and more ways to target their audience and don't necessarily need a Myspace like perhaps they thought several years ago (at least Google thought that). It's also a very well known fact that the amt. of ad dollars that can be charged for these websites has declined significantly with ever increasing competition. Where does that leave a Myspace? Not in a great spot, that's for sure.

Frankly, I don't see any way that Myspace will ever become what they thought it would at this point. I would recommend to them to scrap their present design and admit that Facebook has killed them, and do a lot of copying of them. With some sort of enhancements.. I don't know what they could be, they may get back on something of the right track. God knows they're on the wrong track now. Myspace seems to be centered around music and various vices. Facebook is centered around people, which is why Facebook is winning. Just my impressions.

My Space is not dead by a long shot.

I would suggest the following upgrades:

1. Sorting of friends by communities, i.e., Music Genres, Male, Female, Friends, Best Friends, Venues, Promoters, Managers, etc.

2. MySpace MyFriends Email List with the ability to EDIT.

3. Load Faster

4. Connections to one's "other" sites/blogs

Q: What is the difference between social web site Facebook and MySpace?
A: About two years.

Facebook in the summer of 2009 is like MySpace in the summer of 2007. Facebook will be the next to fall. Something like 90% of Facebook's traffic is from outside of the U.S.

Social web sites are like television shows. They have a definite shelf life before people move on to other things. In 2011 we'll be reading about massive job cuts at Facebook.


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