Newscorp sold MySpace to Specific Media today for $35m dollars, not bad for a company that is estimated to have lost $150m last year.
Justin Timberlake will be playing a major role in the acquisition - his experience pretending to be an executive of a real internet company should prepare him well for being the real executive of a pretend internet company. His business plan, to make myspace a portal for interacting with bands and accessing music, sounds suspiciously like the old business pan.
Who do you feel worse for?
-The Allen & Co bankers who had to work for months to try to sell this dog...I wonder how much they were paid ($1.05m is 3% of $35m)
-MySpace employees, roughly half of whom are going to be laid off
-The founders, who watched their once proud creation go up in flames (For those of you unfamiliar with the MySpace blowup, I highly suggest the Bloomberg article about the demise of MySpace published last week. )
-Newscorp, who paid $580 for MySpace not six years ago (valued at $12b in 2007, what is that IRR?)
I'm surprised Mark Zuckerburg didn't make a bid on the company so that he could enjoy literally burning myspace building to the ground...Might as well put them out of their misery once and for all.
The good news - the 0.2x revenue multiple should finally put to rest fears of a social media bubble!
lessons to be learned from this case
God I kill to see that book.
facebook is the next myspace since the whole point of facebook has been lost.
lessons to be learned indeed.
last i checked, facebook was valued somewhere around $100 billion? i've been using Google+ for the past two days, and if i were facebook or a facebook investor, i would be VERY scared. even in it's limited Beta realase, this new social network has great UI, and can easily attract a user base to rival facebook by simply converting gmail and google account users.
what's even scarier for facebook is that Google+ addresses many of the issues that we all hate about facebook. ever had the awkward situation when an elederly family member or boss wants to add you on facebook? Google's concept of "Circles" addresses this situation rather brilliantly, and it will be very difficult for facebook to immitate (not so much for new members, but for those of us who have 100s of friends, i don't see how this can happen).
very much like myspace back in 2005, people have been valuing facebook under the assumption that it's the be-all end-all of social networks. i'd be willing to bet that Google is about to prove them wrong.
solution: don't add family members on FB... Or in a similar vein, I doubt you have hundreds of family members added on Facebook, so in reality it's quite easy to simply exclude them from the posts about your heinous acts of debauchery via privacy settings.
Facebook has given me something that I can't see G+ capitalizing on: seeing the majority of the jocks/sluts from HS end up being baby mommas and perpetual CC attendees.
Had a rough time in hs I assume? Sorry to hear that bro.
Nice to hear that Sayandarula, I am looking forward to ditch facebook for google+ ASAP..
Yea I'm hearing good things about G+. I think that Facebook will stick around namely because they've done a good job of getting people from all social circles on there, not that Google won't steal some of their users. MySpace always had that underground music/tween feel to it.
Yeah...why wouldn't Facebook pay the $35M if not to just put them out of business?
Maybe Facebook didn't have the $35MM lying around - adding more fuel to whether FB is worth $100B...
Why would facebook waste 35m on a shit company that's no real threat to their business? There are better ways for facebook to drop that kind of money.
Yes
And to facebook, I dont think that they´re worth more than $20 billion. Turnover of $2 billion, profit of $700 million. okay and 500 million "potential" customers.
And now Google is starting Googlebook or whatever. I would sell my shares of Facebook now at the highest price, waiting for higher listings is just speculation.
The fact is, social networking has turned into a very competitive industry, and only the strongest will win out. I see Myspace as retaining that music/tween niche that they've been good at since the beginning, but I think at this point it should be content to let Facebook take all the scrutiny and attention for being the biggest social network. At least, that's what I would do.
I wouldnt have even paid $3.50
The only problem for Google+, is that Facebook already has like 15% of the population on it!
Gooogle+ makes it very easy to add friends. Only 20 or so ppl that I know who are on G+ were in my "circles" within a few minutes. Also I would imagine the number of gmail and google account users rival fb users. G+ is so well integrated with these other functionalities that I wouldn't worry about it not getting members.
Someone set me up with that google+.. I need some google friends
I've been looking forward to the downfall of Zuck ever since he turned down that $3B offer however long ago. I guess he didn't realize that he could buy anything he wanted (short of a spaceship) for the rest of his life with $3B. G+'s Circles feature will solve much of the issues with facebook...like when your girlfriend sees a wall post from another girl. I look forward to checking out G+ and leaving FB. Also with the Circles feature...if you can separate your business network, what is the likelihood that G+ can bite into LinkedIn?
LinkedIn is simply the best network, its more professional and straight, on FB there is so much manipulation-> fraud,stalking,dealing,viruses etc.
I suspect Allen gets paid a retainer fee by News Corp. and doing this deal was a necessary evil for them.
Maiores cumque voluptas fugit sunt tempora. Neque minus quis molestias earum ut nihil. Qui id fugit aperiam omnis ab natus. Beatae dolore perferendis officiis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Quo corporis illo voluptatem nihil accusantium facere. Aut facilis mollitia molestiae iure qui consectetur. Quasi asperiores sunt eveniet et nulla sequi. Consectetur qui facilis facere magni vitae consectetur sequi. Fugit voluptatum dicta ad id. Enim suscipit suscipit est et.
Accusantium commodi sed id. Enim facilis rerum est blanditiis. Aliquam doloremque ratione et nihil nihil hic distinctio. Voluptates tenetur consequatur porro asperiores dolorem qui. Et sed eligendi porro in unde qui. Aut labore dicta accusamus consequatur ducimus inventore rerum.