MySpace in trouble on $900 million Google deal

During the News Corp (NWS) earnings call, CEO Rupert Murdoch and COO Chase Carey both mentioned that the entertainment company's deal with Google (GOOG) to deliver ad space to social network MySpace was in trouble. Murdoch said, "It's quite simple. We've not been making our minimum guarantees so our search revenue will not be what our revenue was." "We're still losing traffic," Chase Carey, chief operating officer of News Corp told the Financial Times. "It's a business in transition."

The deal with Google, which runs from the first quarter of 2007 to the second quarter of 2010, was expected to bring News Corp $900 million. Murdoch indicated that the payments might come up as much as $100 million short because of traffic shortfalls at MySpace.