MySpace to outsource Australian ad sales and axe half its staff
Rebekah Horne
MySpace boss Mike Jones has confirmed that the company is cutting around half of its global staff and signalled that the site’s Australian operation is likely to be dramatically scaled back with advertising sales and content management outsourced in what may mean just a skeleton operation remaining locally.
Mumbrella also understands that MySpace Australia boss Rebekah Horne is likely to move to the US as part of the shakeup although the company has declined to comment on this.
In a statement issued early this morning Australian time, Jones, CEO of the News Corp-owned company, said:
“Today Myspace is implementing a significant organizational restructuring that will result in a 47 percent staff reduction across all divisions globally and impact about 500 employees. With our recent relaunch as an entertainment destination for Gen Y, we introduced a much tighter focus, a significantly streamlined product and an updated technology platform.
“In international, Myspace, Inc. will be entering into strategic local partnerships in the UK, Germany and Australia to manage advertising sales and content. In the UK, Myspace will enter into a strategic alliance with .Fox Networks, with whom we have successfully partnered with in many international territories. Details about Australia and Germany are currently being finalized. Myspace will retain a core, dedicated international team to work with partners in order to ensure users, content partners and advertisers continue to be served.
“Today’s tough but necessary changes were taken in order to provide the company with a clear path for sustained growth and profitability. These changes were purely driven by issues related to our legacy business, and in no way reflect the performance of the new product. The new organizational structure will enable us to move more nimbly, develop products more quickly, and attain more flexibility on the financial side. We are also committed to rebuilding the company with an entrepreneurial culture and an emphasis on technical innovation.
“While it’s still early days, the new Myspace is trending positively and the good news is we have already seen an uptick in returning and new users. Since the worldwide rollout of the new Myspace, there have been more than 3.3 million new Profiles created. We also introduced Topic Pages, which connect users to entertainment-focused content from news sites and blogs all over the Web. Over 134,000 Topic Pages have been created since the introduction of the new Myspace. There has also been a boost in viral activities, with over 10 million social actions and 90 million “follows” within the Hubs and Topics categories. In addition, we are seeing Curators driving a lot of the engagement on our site. Users who “friend” one of our Curators increased their frequency of visits by 35 percent. Lastly, we have already seen a rise of four percent in mobile users just between November to December, now totaling over 22 million.”
Although the statement said there has been no decision made about the Australian sales operation, one obvious option would be to fold it into sister company News Ltd’s extensive digital operation. However, that may be dependent on News Corp’s plans for MySpace which it has hinted may include selling the site.
(8.55am update: A spokesman for News told Mumbrella: “NDM will not be taking on ad sales for MySpace.”)
Outside of the US, Australia is one of MySpace’s largest outposts. According to the UK’s Daily Telegraph, the international operation including Australia will be reduced to a “skeleton staff”.
The announcement had been anticipated for several days.
Jones took over MySpace last year and set a new strategy aimed at turning it into first and foremost an entertainment destination rather than social network. In an interview with Mumbrella editor Tim Burrowes last year, he was forthright about the loss of direction the company had suffered.
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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I guess this was inevitable, but that wouldn’t make it any easier for the Myspace AU team. What a shame – wishing everyone there all the best with whatever happens with their jobs.
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MySpace is a casualty of online natural selection, could we be witnessing the first major social media extinction?
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Sorry to hear wants happened – take care OZ team, best of luck for the future.
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Each of the aspects of social media are rapidly changing and MySpace is really one of the first to clearly define what it wants to be in the future. I think the same is happening for Facebook and Twitter as well.
While we don’t have enough roles for everyone, if anyone is looking for a sales role in the social media space, we are currently looking.
Trish
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My question presumes much without really asking anything, god-forsaken whipper-snapper that I am.
Trish is right, MySpace is simply redefining itself. I still use MySpace to suss out under-exposed bands, even sourcing an excellent jingle from an artist who’d never done commercial music before. Its also been a great platform for local fashion at http://www.myspace.com/fashionau
If those two industries weren’t presently embattled, MySpace would be in an enviable position. MySpace may be going through a process of natural selection, but to say its going the way of the dodo is unfairly presumptuous.
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very sad, i thought myspace’s repositioning in ‘social entertainment’ was a smart move…but maybe they are just too tarred from the old myspace music brush…3.5m new fans since relaunch sounds like alot, but when you compare what FB puts on in a day, something like 2 million a day…
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I wrote a post about my 4 years there, along with my reflections and perspective on the current news.
Hope you find it vaguely interesting 😉
http://www.coloursandlight.com.....of-an-era/
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The whole mindset, personnel and management ethos of News Corp is unsuited to running an outfit like MySpace.
Slashing staff worldwide is an advance ? Sure, sure, we believe you. It’s also a sign of how well the latest changes are going too, right ? And a partnership with Fox is a good thing ? Um, yeah, ok. Doesn’t sound so much like an understanding of the market as a directive from New York on leveraging corporate assets.
Can’t wait to see the next big advance.
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Their losses suggest the whole place was bloated and over spending. No need to over complicate what this is … It’s a badly run business that has finally had to the reality most media businesses already adhere to.
The comments around being thrilled and delighted to outsource their UK sales to fox on the same day they boned hundreds of people show the incompetence evident In the place.
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A now cashed up facebook could potentially buy myspace? Now THAT would interesting!
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Facebook may be poaching the talent of myspace and that could be its demise?
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Ironic isn’t it? The management responsible for it’s failings keep their jobs but the little guys get the chuck. Good work News, classic nepotism!
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MySpace: What, a News Ltd. web operation that’s badly run?
Surely you jest!
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Its not “Myspace” anymore its every other person space on one account and its confusing with all the adverts flying about, getting rid of personal things from each and everyone of us….
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