Murdoch on MySpace: We "screwed up" in the race against Facebook

Rupert Murdoch today admitted that News Corp dropped the ball when it came to MySpace. 

A Facebook advertisement is shown on the MySpace page. Rupert Murdoch, head of News Corp, said this week that his company had made significant missteps in its handling of MySpace, which News Corp acquired in 2005 for almost $400 million.

In July of 2005, News Corp acquired MySpace for a whole lot of cash. ($580 million, to be exact.) And why not? The deal looked like a good one: At the time, MySpace was the most popular social networking site in the US, with a robust membership, and domination of rival network Facebook. Fast forward six years, and Facebook is now in the top slot, while MySpace – beset by corporate shake-ups, lay-offs, and general discontent – is struggling to survive. 

None of which has been lost on Rupert Murdoch, chief of News Corp. In a tweet today from the floor of CES, in Las Vegas, Murdoch acknowledged that his company had taken some major missteps when it came to MySpace. "Many questions and jokes about MySpace. Simple answer – we screwed up in every way possible, learned lots of valuable expensive lessons," Murdoch wrote

So is Murdoch right to be chagrined? Well, over at Wired, John C. Abell says the News Corp acquisition of MySpace certainly belongs on "tech investment Wall of Shame." Still, Abell adds, in "fairness to Murdoch... there is no shame in putting down big money for a company which, at the time, seems like the Big Dog as a way of accelerating your way into a fast-moving market which only seems to be going up." 

In related news, this week at CES, Justin Timberlake introduced a new venture between MySpace TV and Panasonic, the electronics manufacturer. Timberlake said the initiative would blend social media and TV watching – CBS described it as "Hulu and Netflix with social networking." Timberlake, Horizons readers may remember, owns a minority share in MySpace, which was sold last year to an ad firm called Specific Media

"We're ready to take television and entertainment to the next step by upgrading it to the social networking experience," Timberlake said. "Why text or email your friends to talk about your favorite programs after they've aired when you could be sharing the experience with real-time interactivity from anywhere across the globe?" 

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