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MySpace Sold for Just $35 Million to Specific Media and Justin Timberlake

By - Source: All Things D | B 14 comments

It's been a mental couple of days for the social networking world, mostly due to the partial launch of Google's new Google+ service. However, something else monumental happened on the social networking scene: MySpace was sold.

Once hugely popular, MySpace has been struggling to remain relevant for a long time. Sold to News Corp in 2005 for nearly $600 million dollars, the company's fall from grace has been slow but steady. A recent redesign attempted to revitalize the service but, for the most part, the company can't seem to regain its footing. Still, change could be on the horizon as the social network now has a new owner. Specific Media this week announced that it had purchased MySpace for just $35 million. MySpace's previous owner, News Corp, will hold onto a five percent stake in the company. In a strange twist of events, 'The Social Network' star Justin Timberlake has also purchased a stake in the Facebook rival.

Though details of the sale were not released, MySpace, which laid off roughly 50 percent of its employees in January of this year, will reportedly shed half of its 400-strong staff as part of cost cutting measures.

"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," said Specific Media CEO Tim Vanderhook.

An email sent by MySpace CEO Mike Jones confirmed there would be structural changes but did not specify how many people would be getting pink slips. He also informed staff that he would be leaving following a two month transitional period.

"In conjunction with the deal, we are conducting a series of restructuring initiatives, including a significant reduction in our workforce. I will assist Specific with the transition over the next two months before departing my role as Myspace CEO," Jones said.

Timberlake's role as an investor will not be in name or wallet only. When asked by AdAge who the new CEO was going to be, Specific Media CEO Vanderhook said that they hadn't really thought about it yet because they were more focused on getting Justin Timberlake on board.

"We don't have that person today. The one thing we were looking for immediately was bringing Justin Timberlake in -- we were looking for someone to drive creative strategy," he said. "But as for day-to-day, myself and my brother Chris will take over day-to-day."

Explaining the reasoning for Timberlake's involvement, Vanderhook said it was all about creativity and passion.

"As we started to recognize this transaction was going to happen, the one thing we wanted was help from the creative community," said the CEO. "We thought, "Who is the most talented person for this?" And it was really Justin. We saw different groups of people, and he got incredibly passionate about it," he continued, adding that Justin Timberlake had put his own money down for the project, and would have an office and a team of staff at MySpace's HQ but would probably not be there everyday.

Speaking about his new business venture, Timberlake said:

"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. Art is inspired by people and vice versa, so there's a natural social component to entertainment."

Read more about Specific Media's plans for MySpace on AdAge.

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Top Comments
  • 19 Hide
    dalethepcman , July 1, 2011 7:12 PM
    I'm bringing MySpace back
    Them other networks don't know how to act
    I gave thumbs up to your post bout LoL Cats
    Next time your on make sure to Thumb me back
    (take em to the bridge)

  • 11 Hide
    angelraiter , July 1, 2011 7:08 PM
    lol Justin Timberlake got ripped off
Other Comments
  • 2 Hide
    house70 , July 1, 2011 6:48 PM
    Before Google+ happened I would have given this a good chance. Now, not so sure...
  • Display all 14 comments.
  • -4 Hide
    eklipz330 , July 1, 2011 6:50 PM
    house70Before Google+ happened I would have given this a good chance. Now, not so sure...

    seriously? it's been around for half a decade, and NOW you'd give it a chance?

    myspace was a lost cause compared to facebook. hell, i think sconex was even better. i wished facebook was exclusive to college students and older though.
  • 1 Hide
    dogman_1234 , July 1, 2011 7:02 PM
    JT? Really?
  • 11 Hide
    angelraiter , July 1, 2011 7:08 PM
    lol Justin Timberlake got ripped off
  • 19 Hide
    dalethepcman , July 1, 2011 7:12 PM
    I'm bringing MySpace back
    Them other networks don't know how to act
    I gave thumbs up to your post bout LoL Cats
    Next time your on make sure to Thumb me back
    (take em to the bridge)

  • 0 Hide
    millerm84 , July 1, 2011 7:51 PM
    I wonder if playing in The Social Network gave Timberlake the notion he knows anything about "creative strategy" in this arena. It's one thing to market new and innovative products (like sony's 3D tv spot he did) or your special brand of boy band; its a whole different ball game when you have to take a dying brand and be the innovator. I know Eminem has been used to try and create excitement for Chrysler, but I doubt he's in the drawing room with the engineers or doing much more then telling the marketing guys "I can look bad ass driving this color car".
  • 1 Hide
    robochump , July 1, 2011 8:06 PM
    Main issue with MySpace is that it was not work friendly and too many annoying ads with a poor layout. Revamp was too little too late and Newscorp can blame themselves for being too greedy and not doing what is required to keep MySpace relevant. See what happens.
  • 1 Hide
    JOSHSKORN , July 1, 2011 9:45 PM
    It still worth even $35 million, really? Does anyone use MySpace anymore? Oh, I do...for my Mobsters account. I've got like 10,000 friends on it I think, maybe 15 of those are my actual friends. Of those (15), I highly doubt any of them use MySpace and have gone onto Facebook.
  • 1 Hide
    ravewulf , July 1, 2011 10:12 PM
    Justin Timberlake > News Corp
    This is less a comment on what I think of JT and MySpace, more of a comment of what I think of News Corp
  • 1 Hide
    RazberyBandit , July 2, 2011 12:28 AM
    dalethepcmanI'm bringing MySpace backThem other networks don't know how to actI gave thumbs up to your post bout LoL CatsNext time your on make sure to Thumb me back(take em to the bridge)

    Best post ever! LMAO!
    I wish we could embed audio for that one!
  • 0 Hide
    ProDigit10 , July 2, 2011 12:34 AM
    myspace, much less popular than facebook, is going down!
    Facebook itself is going down!
    A lot of friends I know no longer are on facebook (or never went on it!)
  • 0 Hide
    kj3639 , July 2, 2011 5:10 AM
    Hahahahahaha. Myspace, what a joke. I had a profile for a month, back in its prime. I had joined facebook first, when it just reached our campus. Myspace was such a joke... and creepy too. I enjoy facebook, I just wish it somehow (not possible whatsoever) stayed like it was in it's early days. Bunch of young college people, photo sharing, parties, beer bongs... stuff grandma wouldn't like, but too bad because she's on facebook now.
  • 0 Hide
    master9716 , July 2, 2011 5:42 PM
    ITS SIMPLE. SPAM! , There is no spam in facebook , Theres huge spam in Myspace so people dont take it seriously , Design wise myspace lets you do things facebook and twitter cant. But its also more complicated. Wich is also another huge reason.

    It needs to be more personal so they can get rid of spam , And it needs to be simple.
  • 0 Hide
    fir_ser , July 2, 2011 5:46 PM
    MySpace had been killed by Facebook, but let’s see if it can distinguish itself from the competition.
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