Myspace

Luke Y.



History
Before Facebook became the behemoth it is today, there was Myspace.

A social network based on music-sharing, Myspace was founded in August 2003 by employees of eUniverse, an internet marketing company.  The founders were encouraged by the potential seen in other online communities, namely Friendster.  

On January 2004, the site officially launched.  After just one month, 1 million people had signed up with the website.  After 10 months, the number of users was at 5 million. Within a year, Myspace had become a force to be reckoned with, showcasing unprecedented adoption rates and high user engagement.

In 2005, Rupert Murdoch’s News Corp. bought Myspace’s parent company for $580 million, putting Myspace at a valuation of around $327 million.  Needless to say, Myspace had officially become a very big, very profitable company.  It was fastly becoming the most popular site, a go-to for connecting with friends.

In July 2006, Myspace became the most visited website in the nation, beating out Google and Yahoo.  In fact, it accounted for 80% of all traffic on social networks.  News Corp. was seen as having gotten a great bargain for its $580 million deal the year prior.

Myspace reached its peak in December 2008 with 76 million unique U.S. visitors. However, by 2008, Myspace faced a contender building serious buzz online: Facebook. 

New kid on the block.

After this point, we saw Myspace slowly crumble.  The CEO and co-founder stepped down in April 2009, and the number of users was down about 4 percent from the previous year, showing that people were actually actively leaving the service.  Albeit these warning signs, Myspace was still the largest social network in the U.S. during this time.

Later in 2009, Facebook officially beat out Myspace as the most used platform.  Myspace was losing steam, fast.  With its overly-customized profile pages, Myspace was losing its users to Facebook, a site with incredible minimalist designs and simplicity of use.  While Myspace pages pushed users to customize them and add elements, Facebook gave them much less options for a more streamlined look across the site.  The photo-tagging and event-sharing functions especially helped Facebook take off virally.  To add fuel to the fire, the fact that Facebook had started as a college-only social network made it seem cooler and more exclusive. Because it also made people use their real names, it seemed like a cleaner, safer alternative.

Busy.

Clean.

In January 2011, Myspace was forced to lay off nearly half of its employees, as around 500 people were let go.  Myspace then went “on sale” in April 2011.  It was severely hurting as a company, with its user base dwindling.  Between January and February alone, it had lost 10 million users.  Losses from the last quarter of 2011 summed up to $156 million.

With the company in obvious decline, investors remained skittish.  Although the deadline for bids was May, it wasn’t acquired until June 29.  

In 2011, Myspace sold for $35 million.  More than $500 million lower than it was worth 6 years prior.

Current State
After spending 3 years as the most visited social networking site in the world, it is now a shell of its former self.  Myspace had less than half as many visitors last year as it did when it peaked. While in June 2009 it had 1,600 employees, last year it was down to 200.

Currently, it is in the process of being revamped.  Its new owner Specific Media LLC has partnered with Justin Timberlake to breathe new life into the social network, focusing more on its music aspects.  Considering Myspace started out and flourished as a community based around music, maybe its best future lies in exploring its past.






References:
http://blog.alexa.com/2008/05/facebook-overtakes-myspace_07.html
http://mashable.com/2006/07/11/myspace-americas-number-one/
http://www.businessweek.com/news/2011-06-29/news-corp-calls-quits-on-myspace-with-specific-media-sale.html
http://money.cnn.com/2011/01/11/technology/myspace_layoffs/index.htm