Murdoch is a one-trick pony and MySpace ain’t his arena!

Myspace was once the Internet’s equivalent of the hottest nightclub in town. In its heyday, the world’s dominant social network attracted some 3 million bands, 8,000 comedians and countless filmmakers and wannabes who came to see and be seen.

Now, Myspace is seemingly no place — a digital castoff that corporate parent News Corp. sold for $35 million in cash and equity to an Orange County digital media firm specializing in online advertising. That’s a fraction of the $580 million that the media giant controlled by Rupert Murdoch paid to acquire the site a scant six years ago, and well shy of its one-time $65-billion valuation.

Its dramatic fall is both a consequence of the fickle nature of today’s Internet generation as it is a tale of mismanagement, missed opportunities and miscalculations. Myspace’s decline — hastened by its failure to match the innovations of its chief rival, Facebook, speaks to what can happen when a mainstream media company seeks to capture technological lightning in a bottle…

The decision to acquire the hot social networking site landed Murdoch on the cover of Wired magazine, where he was lauded for embracing the Internet ahead of his old-media rivals, although critics ridiculed him for overpaying…

But Myspace’s red-hot success was short-lived.

The number of monthly visitors in the United States peaked in October 2008 at 76.3 million, according to measurement firm ComScore Digital Analytix. Over the last two years, the social network has shed an average of 1 million users a month, and its monthly traffic had dwindled to about 35 million users by May.

As Myspace’s users headed for the exits, so did the advertisers. Researcher EMarketer projects Myspace’s ad revenue at $184 million this year, down from $470 million in 2009. Myspace proved a drag on News Corp.’s earnings, with the division that includes the social network posting a profit only once in the last six years…

Murdoch knows how to leverage sports coverage in depth into profit in print media. He did the same with business news with the Financial Times. Dicking around with content, policy and politics at the Wall Street Journal may yet put that venerable paper into irreversible decline. All of his print acquisitions were worth siphoning capital from – while adding in deeper coverage of shallower topics when needed.

None of that had [or has] much to do with the media and information processes driving the Web. But, good old Rupert has never been someone to listen to or seek advice. Even from more knowledgeable family members.

The folks who bought MySpace for 6% of what Murdoch paid have a sensible chance to turn it into a moneymaker, again. That’s good enough. Whether they wish to go farther than that – and can – is another tale, a different opportunity.

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