MySpace, the faltering social network, relaunched its service today as a multimedia platform. It's a radical departure from the format that made it the world's largest social network -- a distinction it has since given up to Facebook, which now claims to have over 500 million users.
The News Corp. (NWS) property said in a note to users and the press that it had created "a new brand, website and a suite of products that together redefine the company as a social entertainment destination for Gen Y. Myspace is creating a rich, highly personalized experience for people to discover content and connect with other fans who share similar interests. The entertainment experience will span music, celebrities, movies, television and games and will be available through multiple platforms, including online, mobile devices and offline events."
A video provided for visitors shows that the new site looks more like a portal in the style of Yahoo (YHOO) than like Facebook. And it may be that MySpace believes the portal business is a more lucrative way to garner revenue. Despite its size, market leader Facebook is likely to have revenue of only $1.2 billion this year, compared to Yahoo's $6.5 billion. At MySpace's high-water mark three years ago, News Corp. indicated its revenue was under $1 billion.
News Corp. bought MySpace in July 2005 for $580 million. Many analysts believed then that the move by Rupert Murdoch was a brilliant way to get a large presence on the Internet, but upstart Facebook quickly took over. According to Comscore, Facebook had 148.4 million unique visitors in the U.S. for September. News Corp. sites (listed as Fox Interactive) had 81.3 million unique visits, the majority of which are assumed to be to MySpace.
Analysts may believe that the relaunch is a gamble, but given the troubled state of MySpace, News Corp. has no other reasonable choice.
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