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

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.