Specific Media is acquiring Myspace for $35 million

Justin Timberlake is taking a stake in the new Myspace
Justin Timberlake will have a hand in shaping the new Myspace

For a lot of people, Myspace was their first introduction to modern social networking. News Corp. saw great potential in the site and in 2005 acquired it for a whopping $580M. However, Myspace did little to innovate and keep up with competitors like Facebook in the past six years. Myspace even tried to pivot and transform itself into a media portal, but that transition hasn't exactly been a fruitful one.

As a result, Facebook grew to become the dominant force in social networking (the site now has 750 million active users per month) while Myspace fell further and further behind into irrelevancy.

The next chapter in the Myspace saga begins today, as the site was just purchased by Specific Media for $35 million. That figure is above the $20 million to $30 million figure that was thrown around by Kara Swisher yesterday. However $35 million is well below the price News Corp. paid and a third of the $100 million price that the company was hoping to get for its faltering online property. 

According to today's report by Swisher, Myspace will see its staff cut in half to around 200 employees, and the executives responsible for running the ship aground will be tossed overboard once the transition phase is completed. 

"I wanted to take a minute to thank you all for the incredible experience it has been to lead this company and to work closely with all of you over the past several years," said current Myspace CEO Mike Jones in a memo today to current Myspace employees. “While I regret we won’t be working together at Myspace any longer, I am very proud of the work we have done here and believe we have performed with excellence — even under extremely difficult circumstances." 

“Myspace is a recognized leader that has pioneered the social media space. The company has transformed the ways in which audiences discover, consume and engage with content online,” said Tim Vanderhook, CEO of Specific Media. “There are many synergies between our companies as we are both focused on enhancing digital media experiences by fueling connections with relevance and interest. We look forward to combining our platforms to drive the next generation of digital innovation.” 

Interestingly, pop singer Justin Timberlake – who had a starring role in “The Social Network”, a movie about the origins of Facebook – is also purchasing a stake in the new Myspace and will have a say in the direction of the company. “There’s a need for a place where fans can go to interact with their favorite entertainers, listen to music, watch videos, share and discover cool stuff and just connect. Myspace has the potential to be that place,” said Timberlake.

“Art is inspired by people and vice versa, so there’s a natural social component to entertainment. I’m excited to help revitalize Myspace by using its social media platform to bring artists and fans together in one community.”

"We basically took a look at this situation and said, this is bullshit." -- Newegg Chief Legal Officer Lee Cheng's take on patent troll Soverain
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