And so it came to pass that Rupert Murdoch’s NewsCorp finally sold ailing ‘social entertainment destination’ MySpace this summer. NewsCorp had acquired the site in 2005 for some $580m – it was the place to be online, a first introduction to modern social networking for many people around the world; and as such NewsCorp saw huge money-making potential. In June 2011, the company offloaded MySpace to little-known, California-based digital media company Specific Media for a paltry (reported) $35m – about seven cents on the dollar it had originally paid six years ago. So what went wrong?
MySpace boomed and boomed when NewsCorp first took control. Fox Broadcasting, part of the NewsCorp group, soon announced MySpace’s extension to the UK to “tap in the UK music scene” and a raft of launches internationally, including China. Simple geographical growth allowed aspiring music artists to grow too, sharing their discographies to an ever-widening and ever more receptive audience.
MySpace bolstered its position in 2007 by aligning closely with Google to co-nurture further social networking expansion. Here was a partnership that would help it consistently out-manoeuvre Facebook in terms of web traffic and generate a $12bn valuation.
But MySpace needed to evolve as well as expand and, by and large, it didn’t. Many commentators argue that it stuck too rigidly to a ‘portal strategy’ placing major emphasis on users customising their own individual pages rather than upping the social network ante. There remained keen focus on entertainment and music, epitomised by the launch of initiatives such as MySpace Music (introduced in 2008, offering different page profiles so artists could upload discographies), the MySpace Records label and MySpace Transmissions (live in-studio recordings by users), but without a sophisticated social network mechanism to support it, such focus started to weaken and memberships fall away to Facebook.
At the same time, many of MySpace’s musical enterprises were poorly organised and executed. MySpace Music was largely run (without executive board) as a separate business, partly in an attempt to re-engage users already disenfranchised by the main MySpace brand. Sadly, it had the opposite effect, diluting MySpace’s wider profile as viable digital destination.
That brand dilution continued as NewsCorp’s media-sellers flooded users’ pages with countless digital marketing packages – media banners with little connection to their host site selling everything from cars to insurance. Such flashy advertising also cluttered, muddled and slowed pages, making them further unattractive to users. Without the standardization of a network like Facebook – standardization also applying to the public, some of whose amateur, unregulated page designs caused regular browsing issues and screen crashes – brand loyalty quickly waned.
Perhaps the most contentious issue, however, was the ownership of MySpace Music by the four big major labels, Universal, Sony BMG, Warner and EMI. MySpace was now seen to be favouring commercial music and turning its back on the budding independent artists that had helped define it during the early years. In time, countless young music-makers swarmed the forums to complain that the influence of the majors was making it increasingly difficult to give their own creative efforts air time. MySpace was becoming TheirSpace.
Accordingly, MySpace has lost reams of music-making members over the past three years – the vast majority turning to Facebook’s fluid social networks and business deals with smooth, super-accessible streaming sites like Spotify. MySpace’s music chief Courtney Holt resigned a few months prior to NewsCorp’s sale this summer, leaving the brand’s ongoing musical direction firmly in doubt, and then new industry figures declared the site had lost roughly 30 million global monthly visitors since 2010. MySpace’s UK monthly visitors, meanwhile, have halved.
Step forward Specific Media’s CEO Tim Vanderhook, who runs MySpace alongside brothers Russell and Chris.
“We’re thrilled about the opportunity to rebuild and reinvigorate Myspace,” he said, upon confirming MySpace’s buyout. “We look forward to partnering with someone as talented as Justin Timberlake, who will lead the business strategy with his creative ideas and vision for transforming Myspace. This is the next chapter of digital media, and we are excited to have a hand in writing the script.”
Worldwide pop phenomenon Timberlake has, of course, taken part ownership of the business. Cynics long dead to the idea of MySpace being able to attempt any kind of meaningful revival believe Timberlake’s involvement is purely PR theatrics. However, advertising material leaked onto the internet earlier this month suggest Timberlake has been taking an active role alongside Specific in pitching a new MySpace offering to investors, media communities and music industry reps.
The leak came just days after Specific finally revealed the first details about MySpace’s future music-focused direction during New York’s Advertising Week.
“The great thing is pretty much everybody knows about Myspace, but the favourable opinion of Myspace has fallen off,” Tim Vanderhook explained. “For that to happen, it's about the product and the experience.”
MySpace's rejuvenation, then, will hinge on streamlining and simplifying the site and promoting its key asset - an extensive trove of music and videos, covering around 42 million songs. That trove does also include a considerable amount of material by independent labels and artists, much of it signed up after the initial furore about the site’s tie-ups with the ‘big four’ but several commentators still argue the power is with the ‘mighty’.
Vanderhook and his brothers remain determined to relaunch MySpace in 2012 as a bold new-look social entertainment destination “feeding the energy of youth culture”. The leaked MySpace advert talks specifically about dropping adverts and ‘non-core features’, hosting more exclusive, relevant content, and working with regular music artists, who would share and curate music content.
Specific has, in turn, elaborated that it wants MySpace to become the musical equivalent of TV streaming service Hulu, with unique content rights from major and independent record labels, allowing for ad-backed music video and audio streaming. Vanderhook wants MySpace’s hitherto hidden music streaming capabilities firmly out front, re-stressing that he thinks an ad-funded, on-demand facility can work because of the hours and hours of music he now controls; and adding that NewsCorp simply hid music streaming because they made a loss they couldn’t afford, or work out how to sustain. Further rumours are circulating the music industry, suggesting MySpace is developing tools to help bands monetise any content they place with the revamped portal.
A sizeable number of US social media experts continue to express scepticism that MySpace can make a music-led resurrection work – something that eluded other former giants such as Yahoo.
“I've been working in online since 1994, and there's no such thing as a comeback,” commented Jay Baer, President of digital consultancy Convince & Convert last fortnight. “There are reconstitutions, there are name changes, there are strategic shifts. But in terms of somebody essentially committing user-satisfaction suicide and somehow sewing their wound shut, it's never happened.”
Vanderhook and Timberlake seem, for now, to be talking the talk and walking the walk. They have the vast musical assets to make something work – the record contracts and song library – and, in actual fact, some of the website ‘back end’. MySpace engineers have taken significant strides to improve navigation and functionality for music users over the past year, much of it missed as the great MySpace exodus continues.
But there are huge hurdles. It will take a supreme amount of effort to rebuild a brand that millions have lost faith in, including core segments of the music industry. Vinderhook is making a huge assumption when he says the new MySpace will pay much more attention to independent, grass roots talent – that’s only ‘if’ said talent still believes in MySpace. There is also the competition to consider. Facebook, most notably, has just announced a tie-up with Spotify set to keep it out in front as dominant digital player for the considerable future.
MySpace’s fight for survival has truly begun…
Words: Ben Lovett
