Tech Job Watch Jan 10 2011

MySpace Set to Cut Between 550 and 600 Jobs, Say Sources

By john shinal

Social media site MySpace, which has been struggling amid withering competition from Facebook, reportedly will cut at least 50% of its staff this week.

The cuts will reportedly affect between 550 and 600 of the company's 1,100 workers, including U.S. and international employees.

One report said that the company would all but eliminate its overseas operations. In June, 2009, the MySpace fired 300 international workers, or two-thirds of its overseas staff, and ended operations in several countries.

Executives at MySpace parent company News Corp. have said they are evaluating strategic options for the online service. Such language typically signals that a unit is for sale, and a major staff reduction would be a logical first step to putting MySpace on the block. News Corp. is also parent to Dow Jones, which owns and operates FINS.com.

MySpace's Rosabel Tao, senior vice president of corporate comunications, confirmed in an email that the company has just under 1,100 employees, with 100 of them overseas. She declined further comment.

The social media site, based in Beverly Hills, Calif., was the seventh-most visited U.S. website in 2010, down from No. 5 in 2009.

In late October, MySpace announced plans to re-brand itself as an online entertainment hub and unveiled a revamped version of its site. The move was an attempt to regain its momentum by focusing on its original strength in helping consumers share their favorite music and video entertainment.

When News Corp. agreed to acquire MySpace's parent company for $580 million in July 2005, the site was the world's largest social network with around 16 million users.

At the time, MySpace was made the centerpiece of News Corp.'s online strategy, while Facebook was then available only on certain college campuses.

But MySpace's original strength -- giving members the ability to customize their own pages -- became a handicap when growth took off and it became hard for users to find content.

MySpace founder Chris DeWolfe left the company in 2009, the first in a series of executive departures.

While MySpace has grown to more than 100 million users, it's now dwarfed by Facebook, which passed it as the largest social network in mid-2008 and now has more than half a billion members worldwide. Facebook last week received investment that valued it at $50 billion.

A search for U.S. jobs on MySpace's careers site turned up just two open positions at the company's headquarters. By contrast, Facebook has more than 100 job openings.

Write to John Shinal



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