Oh how the mighty have fallen. One-time king of the social networks, MySpace, has finally been sold by owner News Corp for a rather paltry (rumoured) $30 million to advertising firm Specific Media. The amount is less than a third of the $100 million News Corp were hoping to recoup with the sale of the iconic social network, which paved the way for current social supremo Facebook.
Although in its heyday MySpace made News Corp a bundle through an advertising deal with Google, it has suffered heavily at the hands of more popular rivals in recent years, bleeding users and staff as revenues dried up. Since its acquisition by News Corp in 2005 for $530 million, the site has lost a little over $241,000 per day to end up at its current valuation.
The sale marks another sad day for News Corp’s beleaguered online services division,which lost the company millions last quarter. MySpace isn’t the only lame horse in Murdoch’s stable, however. Tablet-only newspaper The Daily is showing strong signs of atrophy just months after launching.
MySpace had been subject to a takeover bid from original owners Tom Anderson and Chris DeWolfe, as well as several other parties, however News Corp eventually chose Specific Media. The media conglomerate has been looking to shift its costly social network before the end of June, so it can start the new financial quarter without it.
MySpace CEO Mike Jones sent he following memo to all remaining staff –
“Today, we are announcing that Myspace will be acquired by Specific Media, one of the world’s leading online media and advertising platforms. Over the next few days you will be hearing from the team at Specific, including their CEO, Tim Vanderhook, regarding their exciting plans for Myspace and how it fits in with the overall vision of their company.
“In conjunction with the deal, we are conducting a series of restructuring initiatives, including a significant reduction in our workforce.”
