For Sale: MySpace, $100 Million Or Best Offer
MySpace, the former star of the nascent social networking scene, is being unloaded by current owners, News Corp., who are looking to get $100 million for it, the Wall Street Journal reports. A half dozen or so private equity firms and companies are expected to submit bids by the end of this week.
Some of the interested parties looking to purchase any remaining value from MySpace include private equity firm THL Partners, Redscout Ventures and Criterion Capital, which owns social networking site Bebo, Reuters reports. Other names, including Chinese Internet holding company Tencent and MySpace co-founder Chris De Wolfe, have also had a look at the company’s books to see if it’s worth a bid.
Rupert Murdoch’s News Corp. paid more than $580 million for MySpace in 2005, in what was considered an overly optimistic valuation at the time. Like Friendster, MySpace was a pioneer of the social networking space between 2005 to 2007, but it soon dropped out of popularity, primarily to Facebook.
In 2010, News Corp. relaunched MySpace as a social entertainment site with a focusing on music, movies and celebrities. News Corp. also focused on selling advertising, over all else, which allowed more fake profiles that were fronts for spam and scammers. The increasingly frustrating interface and site slowdowns gave users a reason to switch to the easier, secure and faster Facebook, which has since grown to 500 million users, according to AFP.
News Corp. does not detail earning results for MySpace in its statements but the “other” segment which includes the social network reported a second quarter operating loss of $156 million, a $31 million increase from last year.
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