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>News Corp's acquisition for $500m will probably be remembered as a collossal blunder Didn't they have a $900 million search deal from Google, though? (Granted

>News Corp's acquisition for $500m will probably be remembered as a collossal blunder Didn't they have a $900 million search deal from Google, though? (Granted, my understanding is they didn't hit their numbers so they made slightly less than that, but still I think this makes it likely that News Corp's acquisition of MySpace was profitable and not a collossal blunder.) Here's an older TechCrunch article talking about how buying MySpace was one of Murdoch's best decisions ever. (I agree that it looks less good now, but overall I don't think it was horribly bad from a financial perspective): http://techcrunch.com/2008/10/15/three-years-later-buying-myspace-looks-like-one-of-murdochs-smartest-bets/ http://techcrunch.com/2008/10/15/three-years-later-buying-my...

drgath 16y ago
News Corp as a whole, brings in about a billion in revenue / quarter. MySpace loses $150 million+ / quarter, and that's a number that is continually increasing. So if they don't sell it, a few years from now it could seriously threaten the entire company. http://www.pcmag.com/article2/0,2817,2372103,00.asp http://www.pcmag.com/article2/0,2817,2372103,00.asp
- jaredsohn 16y ago
  This is a good point and I take back my conclusions from the previous post. Before I was assuming that 1) MySpace at least was profitable a few years ago and 2) they also received a bunch of money from Google which could be applied against what News Corp paid for it. But most likely, MySpace was only profitable because they received a huge amount of money from Google, so you can't apply most of that Google money against what News Corp paid for it. This means that 1) MySpace's overall return for News Corp should be roughly thought of as ((current value of MySpace) - $500 million) + net profit since News Corp bought it. The first term should be significantly negative and the second term was positive for awhile but as the parent's link indicates is quite negative recently.

drgath 16y ago

News Corp as a whole, brings in about a billion in revenue / quarter. MySpace loses $150 million+ / quarter, and that's a number that is continually increasing. So if they don't sell it, a few years from now it could seriously threaten the entire company. http://www.pcmag.com/article2/0,2817,2372103,00.asp http://www.pcmag.com/article2/0,2817,2372103,00.asp

jaredsohn 16y ago
This is a good point and I take back my conclusions from the previous post. Before I was assuming that 1) MySpace at least was profitable a few years ago and 2) they also received a bunch of money from Google which could be applied against what News Corp paid for it. But most likely, MySpace was only profitable because they received a huge amount of money from Google, so you can't apply most of that Google money against what News Corp paid for it. This means that 1) MySpace's overall return for News Corp should be roughly thought of as ((current value of MySpace) - $500 million) + net profit since News Corp bought it. The first term should be significantly negative and the second term was positive for awhile but as the parent's link indicates is quite negative recently.