6 ms·

Myspace to Be Sold to Specific Media for $35 Million

48 points by ssclafani 15y ago

Macha 15y ago
> News Corp. bought Myspace for $580 in 2005, Nice proof reading there. On a more serious note, to lose $0.5bn in value pretty much shows how far Myspace has fallen.
akavi 15y ago
Jesus, that's a markdown. With the release of Google+, I have to wonder if we'll be seeing something similar with Facebook five years from now.
- WrkInProgress 15y ago
  It's possible but not probable. Myspace at it's peak simply did not have even close to the reach and influence that facebook has currently.
- danilocampos 15y ago
  We'll definitely see Facebook decline but not because of any clumsy product Google offers. Facebook's decline will come from any of a number of new and as-yet-unimagined products that are focused on helping users make new social connections rather than rigidly codifying existing ones. A place for you to chat with your weed buddies, another for your gaming pals, another for your family. Something more analogous to how we socialize in reality. Google's trying this with circles but their social blindspot doesn't leave me confident they'll get anywhere. Everything they do feels contrived in this space. Facebook has lots of a staying power, and a much better product leadership than MySpace. So that buys Facebook plenty of time. But in the end, they're too successful to risk doing anything interesting anymore.
headhuntermdk 15y ago
Might as well as give it away for that price ( compared to how much Rupert Murdoch paid for it )
Major_Grooves 15y ago
They might actually have made their money on the deal. Do we know how much revenues MySpace generated while News Corp owned them?
- WrkInProgress 15y ago
  They had the 900 million dollar advertising deal with Google at one point.
  - marcf 15y ago
    As I said in response to another post, the 2006 Google-Myspace deal had minimum traffic requirements, thus it isn't clear that they made the $900M from Google: http://mashable.com/2010/12/16/myspace-google-search-deal/ http://mashable.com/2010/12/16/myspace-google-search-deal/ I've be interested in knowing whether the targets were met and how much Google paid Myspace in the end.
    - NoPiece 15y ago
      They did have revenue besides google - In 2007 MySpace had $1 billion in revenue. http://www.businessinsider.com/2007/7/myspace-1b-of-r http://www.businessinsider.com/2007/7/myspace-1b-of-r
      - marcf 15y ago
        The $1B in revenue is only an estimate based on projections and a continued growth trajectory. Not saying it isn't true, but it isn't a solid source for their actual revenue. Did News Corporation annual filings every break out revenue from MySpace? Given that News Corporation is a public company, there should be solid numbers somewhere.
        NoPiece 15y ago
        You are right, looking around some more, it looks like $1 billion was never reached. News Corp didn't break MySpace financials out, so all I can find some quotes from News Corp earnings calls. Looks like 2008 numbers were in the ~$200 million range per quarter, "FIM/MySpace: $225M, up 23% y/y, up consecutively from $210M in Q3, but still not as high as $233M in Q2." http://www.techfeed24.com/2008/08/05/news-corp-q4-tv-terrible-as-promised-myspace-revenues-up-profits-down-nws/ http://www.techfeed24.com/2008/08/05/news-corp-q4-tv-terribl...
kprobst 15y ago
Well, that's only a $545 million loss, considering Murdoch bought it for $580 million or so.
- cowkingdeluxe 15y ago
  Wrong. Murdoch probably made a profit off the ads during that time. See above comments.
  - marcf 15y ago
    The Google-Myspace deal had minimum traffic requirements, thus it isn't clear that they made the $900M from Google: http://mashable.com/2010/12/16/myspace-google-search-deal/ http://mashable.com/2010/12/16/myspace-google-search-deal/
  - ssharp 15y ago
    Revenues != profits. If you don't know, or even have a decent estimate of, profits, it's hard to really judge the deal. However, I don't think Murdoch went into this deal planning that he'd have a $540 million capital loss in just five or six years.
skarayan 15y ago
I find it interesting that the founders bid on it.
jmjerlecki 15y ago
At $35 million I think you can make a number of arguments that this is a good purchase – user data, page traffic, ad network. I am unsure how to factor in brand value. Myspace has a huge brand awareness even if it is mostly negative.
- thewordpainter 15y ago
  like you acknowledged, i'm not sure how much weight i'd put in brand awareness when many view myspace as a laughingstock these days. plus, all that traffic is ramping downward at a crazy high rate: http://siteanalytics.compete.com/myspace.com/ http://siteanalytics.compete.com/myspace.com/
  - jmjerlecki 15y ago
    If they can get that traffic to level out, thats still a ton of uniques.
  - marcf 15y ago
    It is like social networks have both the power to grow fast and die fast. Yahoo, even after its search engine sucked compared to Google, still held on for a really long time. But social networks seem to die really really quickly.
KeyBoardG 15y ago
Interesting to hear that NewsCorp made that money back with the Google deal. I had no idea how much that was worth.
staunch 15y ago
That's a damn steal. There's still significantly more than $35 million worth of value left in MySpace. With a new strategy and good execution someone could turn the site into something really big again. The press would eat it up too, because everyone loves a come-back story. Instead some shitty ad company is probably going to turn it into a link farm.
- dasil003 15y ago
  It has value in it, but I don't know what strategy could turn it around. Social networking adoption is a lot about fashion, and with the opinion that MySpace is old, tired, ugly and boring having crossed the chasm years ago, it seems a very tough sell to turn that around.
  - jerf 15y ago
    Rebrand it, sell it as "retro", deal with the fact you won't be Facebook. Lately the nostalgia lifecycle seems to be measured in months, so I'm actually half serious here.
- ebiester 15y ago
  Even a year ago, I'd agree with you. However, Soundcloud and others have really eaten into Myspace's indie music positioning. news corp could have merged Myspace with their other entertainment offerings. Every show of theirs would have a myspace page, and the visual editing operations become more corporate-friendly. Monetize by offering advanced analytics and moderation capabilities to make it another public presence for your entertainment property, from the independent band to The Simpsons. Provide a host of consultants to get the most from your social media. It could be done still, but News Corp would have provided a bigger appeal.
- powertower 15y ago
  First you would have to stop the users leaving. Then you'd have to get people to sign up. What made myspace and other social sites is: "hey that's cool and new and trendy, lets join in". Once that traction is over, it's over for good as there is nothing new or trendy or cool about it anymore. It get's played out. My personal opinion ... social sites are now worn out. Facebook will remain as-is with no new growth (after a while more), Google+/Circle will not have the effect that everyone is claiming it will, MySpace will be gutted for whatever the buyer can use (email lists, patents, talent, etc). 35 million is not a steal, it's probably the fare price at a fare valuation.
horatiumocian 15y ago
I think that MySpace was valued at $12 billion at some point; where there where rumours that Yahoo! would merge with MySpace, and News Corp would receive 25% of Yahoo's shares (they were valued at around $50Bn). Here is the article: http://techcrunch.com/2007/06/19/is-myspace-worth-12-billion/ http://techcrunch.com/2007/06/19/is-myspace-worth-12-billion...
billpaetzke 15y ago
Just FYI, we are hiring ex-Myspace developers at Leads360. We've hired four ex-Myspacers in the past six months. Our technology stack is similar, so the learning curve is only slight. And we have lots of interesting and challenging projects to do. Located in El Segundo; full-time local only. If you got laid off or are ready to jump ship, then email Bill at bpaetzke@leads360.com.
- jaaron 15y ago
  Likewise, we're a new, funded Santa Monica based startup still looking for top web, mobile & backend engineers. Email aaron@projectwbs.com or find me at @jaaronfarr.

48 points by ssclafani 15y ago

Macha 15y ago

> News Corp. bought Myspace for $580 in 2005, Nice proof reading there. On a more serious note, to lose $0.5bn in value pretty much shows how far Myspace has fallen.

akavi 15y ago

Jesus, that's a markdown. With the release of Google+, I have to wonder if we'll be seeing something similar with Facebook five years from now.

WrkInProgress 15y ago
It's possible but not probable. Myspace at it's peak simply did not have even close to the reach and influence that facebook has currently.
danilocampos 15y ago
We'll definitely see Facebook decline but not because of any clumsy product Google offers. Facebook's decline will come from any of a number of new and as-yet-unimagined products that are focused on helping users make new social connections rather than rigidly codifying existing ones. A place for you to chat with your weed buddies, another for your gaming pals, another for your family. Something more analogous to how we socialize in reality. Google's trying this with circles but their social blindspot doesn't leave me confident they'll get anywhere. Everything they do feels contrived in this space. Facebook has lots of a staying power, and a much better product leadership than MySpace. So that buys Facebook plenty of time. But in the end, they're too successful to risk doing anything interesting anymore.

headhuntermdk 15y ago

Might as well as give it away for that price ( compared to how much Rupert Murdoch paid for it )

Major_Grooves 15y ago

They might actually have made their money on the deal. Do we know how much revenues MySpace generated while News Corp owned them?

WrkInProgress 15y ago
They had the 900 million dollar advertising deal with Google at one point.
- marcf 15y ago
  As I said in response to another post, the 2006 Google-Myspace deal had minimum traffic requirements, thus it isn't clear that they made the $900M from Google: http://mashable.com/2010/12/16/myspace-google-search-deal/ http://mashable.com/2010/12/16/myspace-google-search-deal/ I've be interested in knowing whether the targets were met and how much Google paid Myspace in the end.
  - NoPiece 15y ago
    They did have revenue besides google - In 2007 MySpace had $1 billion in revenue. http://www.businessinsider.com/2007/7/myspace-1b-of-r http://www.businessinsider.com/2007/7/myspace-1b-of-r
    - marcf 15y ago
      The $1B in revenue is only an estimate based on projections and a continued growth trajectory. Not saying it isn't true, but it isn't a solid source for their actual revenue. Did News Corporation annual filings every break out revenue from MySpace? Given that News Corporation is a public company, there should be solid numbers somewhere.
      - NoPiece 15y ago
        You are right, looking around some more, it looks like $1 billion was never reached. News Corp didn't break MySpace financials out, so all I can find some quotes from News Corp earnings calls. Looks like 2008 numbers were in the ~$200 million range per quarter, "FIM/MySpace: $225M, up 23% y/y, up consecutively from $210M in Q3, but still not as high as $233M in Q2." http://www.techfeed24.com/2008/08/05/news-corp-q4-tv-terrible-as-promised-myspace-revenues-up-profits-down-nws/ http://www.techfeed24.com/2008/08/05/news-corp-q4-tv-terribl...

kprobst 15y ago

Well, that's only a $545 million loss, considering Murdoch bought it for $580 million or so.

cowkingdeluxe 15y ago
Wrong. Murdoch probably made a profit off the ads during that time. See above comments.
- marcf 15y ago
  The Google-Myspace deal had minimum traffic requirements, thus it isn't clear that they made the $900M from Google: http://mashable.com/2010/12/16/myspace-google-search-deal/ http://mashable.com/2010/12/16/myspace-google-search-deal/
- ssharp 15y ago
  Revenues != profits. If you don't know, or even have a decent estimate of, profits, it's hard to really judge the deal. However, I don't think Murdoch went into this deal planning that he'd have a $540 million capital loss in just five or six years.

skarayan 15y ago

I find it interesting that the founders bid on it.

jmjerlecki 15y ago

At $35 million I think you can make a number of arguments that this is a good purchase – user data, page traffic, ad network. I am unsure how to factor in brand value. Myspace has a huge brand awareness even if it is mostly negative.

thewordpainter 15y ago
like you acknowledged, i'm not sure how much weight i'd put in brand awareness when many view myspace as a laughingstock these days. plus, all that traffic is ramping downward at a crazy high rate: http://siteanalytics.compete.com/myspace.com/ http://siteanalytics.compete.com/myspace.com/
- jmjerlecki 15y ago
  If they can get that traffic to level out, thats still a ton of uniques.
- marcf 15y ago
  It is like social networks have both the power to grow fast and die fast. Yahoo, even after its search engine sucked compared to Google, still held on for a really long time. But social networks seem to die really really quickly.

KeyBoardG 15y ago

Interesting to hear that NewsCorp made that money back with the Google deal. I had no idea how much that was worth.

staunch 15y ago

That's a damn steal. There's still significantly more than $35 million worth of value left in MySpace. With a new strategy and good execution someone could turn the site into something really big again. The press would eat it up too, because everyone loves a come-back story. Instead some shitty ad company is probably going to turn it into a link farm.

dasil003 15y ago
It has value in it, but I don't know what strategy could turn it around. Social networking adoption is a lot about fashion, and with the opinion that MySpace is old, tired, ugly and boring having crossed the chasm years ago, it seems a very tough sell to turn that around.
- jerf 15y ago
  Rebrand it, sell it as "retro", deal with the fact you won't be Facebook. Lately the nostalgia lifecycle seems to be measured in months, so I'm actually half serious here.
ebiester 15y ago
Even a year ago, I'd agree with you. However, Soundcloud and others have really eaten into Myspace's indie music positioning. news corp could have merged Myspace with their other entertainment offerings. Every show of theirs would have a myspace page, and the visual editing operations become more corporate-friendly. Monetize by offering advanced analytics and moderation capabilities to make it another public presence for your entertainment property, from the independent band to The Simpsons. Provide a host of consultants to get the most from your social media. It could be done still, but News Corp would have provided a bigger appeal.
powertower 15y ago
First you would have to stop the users leaving. Then you'd have to get people to sign up. What made myspace and other social sites is: "hey that's cool and new and trendy, lets join in". Once that traction is over, it's over for good as there is nothing new or trendy or cool about it anymore. It get's played out. My personal opinion ... social sites are now worn out. Facebook will remain as-is with no new growth (after a while more), Google+/Circle will not have the effect that everyone is claiming it will, MySpace will be gutted for whatever the buyer can use (email lists, patents, talent, etc). 35 million is not a steal, it's probably the fare price at a fare valuation.

horatiumocian 15y ago

I think that MySpace was valued at $12 billion at some point; where there where rumours that Yahoo! would merge with MySpace, and News Corp would receive 25% of Yahoo's shares (they were valued at around $50Bn). Here is the article: http://techcrunch.com/2007/06/19/is-myspace-worth-12-billion/ http://techcrunch.com/2007/06/19/is-myspace-worth-12-billion...

billpaetzke 15y ago

Just FYI, we are hiring ex-Myspace developers at Leads360. We've hired four ex-Myspacers in the past six months. Our technology stack is similar, so the learning curve is only slight. And we have lots of interesting and challenging projects to do. Located in El Segundo; full-time local only. If you got laid off or are ready to jump ship, then email Bill at bpaetzke@leads360.com.

jaaron 15y ago
Likewise, we're a new, funded Santa Monica based startup still looking for top web, mobile & backend engineers. Email aaron@projectwbs.com or find me at @jaaronfarr.