MySpace For Sale? The Future of MySpace Looks Bleak

Rumors circulating late last year that MySpace may be up for sale have been confirmed.  According to Bloomberg, the once wildly popular social networking site is considering a sale, merger, or spinout if the right offer comes along.

As noted in an article in PC Mag, MySpace was purchased by the media company News Corp. in 2005 at a price tag of $580 million.  Unfortunately, the sale did not prove to be as profitable as it could have been.  The segment of News Corp that owns MySpace reportedly lost $156 million in the last quarter.

This is not the only disappointment, however.  Just a few days ago, MySpace let go approximately half of its staff.  This is in addition to an earlier cutback in 2009 that released roughly 1,000 people from its workforce.

In spite of all this, the company still strives to make gains.  In October of 2010, MySpace underwent a revamp of its site to cater to younger people and musicians.  According to figures from Bloomberg, more than 3.3 million new profiles were created after the change.  The number of mobile users also increased 4% between November and December to push the total number over 22 million.  In November, the company extended its integration with Facebook and in December, it renewed its ad deal with Google.

While the company reportedly appears to be considering many options, News Corp has announced that it would be willing to help fund a spinoff as well as bring in partners, supporting privatizing, and offering stock options to its employees.