View From the Spire: Dead and Buried
June 24, 2011 2 Comments
Each year, 24/7 Wall St. regularly compiles a list of brands that are going to disappear in the near-term. One of this years selections is MySpace.
MySpace, once the world’s largest social network, died a long time ago. It will be buried soon.
News Corp bought MySpace and its parent in 2005 for $580 million which was considered inexpensive at the time based on the web property’s size. MySpace held the top spot among social networks based on visitors from mid-2006 until mid-2008 according to several online research services.
It was overtaken by Facebook at that point. Facebook has 700 million members worldwide now and recently passed Yahoo! as the largest website for display advertising based on revenue. News Corp was able to get an exclusive advertising deal worth $900 million shortly after it bought the property, but that was its sales high-water mark. Its audience is currently estimated to be less that 20 million visitors in the US.
Why did MySpace fall so far behind Facebook? No one knows for certain. It may be that Facebook had more attractive features for people who wanted to share their identities online. It may have been that it appealed to a younger audience which tends to spend more time online. News Corp announced in February that it would sell MySpace.
There were no serious bids. Rumors surfaced recently that a buyer may take the website for $100 million. The brand is worth little if anything. A buyer is likely to kill the name and fold the subscriber base into another brand. News Corp has hinted it will close MySpace if it does not find a buyer.
To read about other brands on their way to the morgue read here.