The pop star Justin Timberlake is part of a group that announced Wednesday it would buy MySpace News Corp, an attempt to add some freshness to a social network that was lost during a time.
The transaction is 35 million, mostly in stock Specific Media, according to a person familiar with the matter. The transaction values MySpace for a fraction of what News Corp. paid for the land six years ago and preparing to lay off about half of the 500 employees, the person said. As part of the exchange, Newscorp receive a personal stake in Specific Media.With the help of Justin Timberlake, buyers expect revitalize MySpace and make it a destination for original programming, and to strengthen its video content is already available, and music."There is a need a place where fans can come to interact with their favorite artists, listen to music, watch videos, share and discover cool stuff and just quit. MySpace has the potential to be the place, "said Timberlake in a statement.Transaction expected to close later on Wednesday, days before the end of News Corp. 's tax. News Corp. maintains a less than 5 per cent parts of the site, said a person who was not authorized to speak publicly and spoke on condition of anonymity.
News Corp. bought MySpace for $ 580 million in 2005, but users, advertisers and musicians who once counted on him for promotion, fled the scene of other hot social networks like Facebook and Twitter. Less than half of MySpace than 74 million monthly visitors are now in the United States where the number of visitors has dropped by half in May to 35 million euros according to comScore Inc. tracking firm
Specific Media has confirmed the purchase but not the terms of the agreement Wednesday.
"We look forward to working with someone as gifted as Justin Timberlake, who leads the business strategy with its creative ideas and vision to change the MySpace," said Specific Media CEO Tim Vanderhook in a statement. "This is the next chapter of digital media, and are excited to have the handwriting of the manuscript."
MySpace CEO Mike Jones, the last member of a management team of three members appointed to fix the place in April 2009, said in a memo to employees Wednesday that he would help the transition to two months before departure.
MySpace launched in 2003, founded by entrepreneurs Chris DeWolfe and Tom Anderson, who is the first friend to all MySpace users. It has become a popular destination and the Internet a key means of little known musicians to sell and interact with their fans.
However, MySpace has lost his balance during the years that pleasure to customize their profile started to break its users and the extensive use of banner ads have slowed the page loading. Meanwhile, Facebook was founded in 2004, which limits users and advertisers can do but keep pages clean and freshen your "news feed" of updates, a copy function after MySpace.
People find it easier to use Facebook and MySpace, Facebook a great migration of up years ago. When Facebook started to allow applications, including music and games as addictive characteristics "Farmville" MySpace has been left in the dust. According to comScore, Facebook has over one billion users worldwide.
"Applications are the breaking point and MySpace can not recover from this," said Charlene Li, analyst at media and founder of the Altimeter Group.
Rohit Kulkarni, a member of 18 years the hero of San Jose, California, punk pop band of four hours, said his group then only to MySpace to reach fans with his music, but have not revised where month. All opened their Facebook page last year.
"Most of our following was in Facebook anyway," said Kulkarni. "Today, people use Facebook more than MySpace, because it is integrated into almost everything, like all mobile phones. I guess that's why it has become more popular."
Even "Farmville" game-maker Zynga took a role to promote the music, as shown recently when Lady Gaga unveiled his new album.
Timberlake participation is a clear sign that MySpace tries to get close to his musical roots.
In the last 11 quarters, News Corp has cumulatively lost about $ 1.4 billion in the segment that houses MySpace. When disposing of the site before the end of the year, News Corp., got rid of about $ 250 million in losses this year, says Barclays Capital analyst Anthony DiClemente.
At 35 million, the media gets specific property on the Internet for a price that Li called "ridiculously low" and the values of monthly U.S. visitors about $ 1 each. His new owners should be able to recover their investment if the company gets for each user to click about 20 ads on their lives, he said.
Specific Media, based in Irvine, California, brokers sell ads for Web sites and affected the creation of original programming and compare them with sponsors. The company was founded in 1999 by brothers Tim, Chris and Russell Vanderhook.
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