Alleynah Cofas

JMC: 5269
Final MySpace Case Study
July 5, 2017

MySpace: The Former Social Media Pioneer

It seems that not even that long ago MySpace ruled the social media world, or what

little of a world it was. After all, this is the company that paved the way for social media as

we know it today. From when the site launched in 2003 until around 2006, it was

inescapably at the top of the minds of internet users. Just one month after the official

launch of the website there were one million users. At its peak, the 100 millionth user

profile was created in 2006, and the company was valued at $12 billion.1 That is, until

Facebook was created and gained major traction from tens of millions of users spanning

over many generations. However, MySpace, despite what it has become in the last almost-

decade, laid the foundation for sites like Facebook and Twitter, but because of it’s

unfortunate life, it is not currently competing with any social media platforms.

MySpace has not been at the front of the minds of users for quite a long time, and

from the time it went online to around the time it seemed to fall away spans over an even

shorter period. It’s such a short time frame for a company to go live, get big, and then lose

traction almost as instantly. But the company’s turbulent past is at least partially to blame

for where the site is today. Although there weren’t necessarily changes in management,

there were a few arguments on who will end up purchasing the company,

counterproductive management figures when the site was purchased, as well as new (at

1http://www.telegraph.co.uk/technology/myspace/8404510/MySpace-loses-10-million-
users-in-a-month.html

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the time) startup social media sites that piggy backed off of the same idea MySpace was

created from.

The idea for MySpace started at Intermix Media–formerly eUniverse–a now defunct

internet marketing company based out of Los Angeles. Intermix Media was known for

having complete ownership of MySpace because the founders of MySpace were also all

Intermix Media employees–Aber Whitcomb, Colin Digiaro, Josh Burman, Chris DeWolfe,

Brad Greenspan, and the most well-known of the group, Tom Anderson, or “Tom from

MySpace”.2

It is reported that Anderson and DeWolfe came up with the idea for the website

because they wanted a way to upload share files–specifically music–with friends, similar to

the ideas that ultimately led to Napster and LimeWire, which were also very popular at this

time. The idea of music was the difference that ultimately ended up setting MySpace apart

from the rest. Anderson and DeWolfe wanted to create a site where not only could you

upload and share photos, but you could also easily upload music files and share those as

well. However, the issue with the already-existing programs (Napster and LimeWire) was

that they weren’t “social”. There were only usernames attached to the software, but no

actual profiles.3 And since the pair was looking for a way to share files among their friends,

it only made sense to piggyback off of Napster, while also telling your friends, and the

world, who was doing the sharing.

2 http://www.huffingtonpost.com/2011/06/29/myspace-history-
timeline_n_887059.html?slideshow=true#gallery/31151/0
3 http://wojdylosocialmedia.com/myspace-started-popular/

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Final MySpace Case Study
July 5, 2017

Anderson and DeWolfe were both users of Friendster.com–a Malaysia-based social

gaming and networking site–and saw that social networking sites had potential, especially

when paired with their idea for music sharing.4 After writing up a business plan for the site,

the CEO of Intermix Media, Brad Greenspan, approved the idea even though Anderson had

already purchased the URL, myspace.com, a year earlier. When the site launched in

southern California, it was originally catered to local artists, actors and musicians

(randomhistory.com). Anderson and DeWolfe had plans of growing the website

internationally, but started it out locally, where it ended up gaining traction because it

catered to young people and the one thing they desired more than anything: being able to

express themselves (randomhistory.com).

MySpace was at the forefront of a new way to share, interact, and connect users

through similar interests, while being completely online. The minds behind the social

media pioneer remained the same, that is until much larger media companies fought to

purchase Intermix Media, and most importantly, MySpace. In 2005, just before the site’s

peak, News Corporation, Viacom Inc., and even Paramount Pictures, each wanted Intermix

Media as another asset to their behemoth media conglomerates. Mark Zuckerberg also

made a $75 million offer, which DeWolfe declined. However, News Corp had to act fast

because of Viacom’s looming interest in MySpace. So, Rupert Murdoch’s deal to buy

Intermix Media for $580 million was accepted, beating out Viacom in asking price.5 News

4 http://www.randomhistory.com/2008/08/14_myspace.html
5 https://www.ft.com/content/fd9ffd9c-dee5-11de-adff-00144feab49a

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Final MySpace Case Study
July 5, 2017

Corp’s purchase was made in hopes of expanding the company’s online advertising base,

and ultimately driving more traffic back to News Corp websites.6

Not too long after News Corp’s purchase in 2008, Facebook surpasses MySpace with

almost 116 million unique visitors to the site, largely because of Facebook targeting

international markets.7 Although MySpace continued to dominate the U.S. market Facebook

added 75 million unique visitors to its site in 12 months (techcrunch.com). Since then,

MySpace has continued to lose users and unique views to Facebook, although not as much

now as before because of Facebook’s current number of users. Reports suggest that the

reasoning for this is because MySpace continued to stick to a strategy that although worked

in the beginning, there came a time where it was not longer working; that was the strategy

of continuing to cater the site towards a specific group of people: young artists and

musicians. On the other hand, Facebook management was pouring all its energy into

creating a new, exciting and easy-to-use social media experience for anyone.8

Another way Facebook gained a leg up in the social media game–although through

no known deals made or contracts signed on the company’s part–was through the 2008

Obama presidential campaign. The former president was the first to utilize social media,

specifically Facebook, for his first campaign. Not only did it catch on real quick, but it gave

him a “database”.9 He had millions of followers that could be reached at any time through

6 http://news.bbc.co.uk/2/hi/business/4695495.stm
7 https://techcrunch.com/2008/06/12/facebook-no-longer-the-second-largest-social-
network/
8 http://articles.latimes.com/2009/jun/17/business/fi-ct-myspace17
9 http://www.nytimes.com/2008/11/10/business/media/10carr.html?mcubz=0

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one medium: Facebook. Maybe this campaign didn’t necessarily create the need for

Facebook profiles to get the most up-to-date information, but since this is how Obama’s

followers were informed, a movement was created.

Shortly after all the commotion in 2008 with Facebook, DeWolfe ends up stepping

down in 2009, only to be replaced by former Facebook COO Owen Van Natta. All of this

happened shortly after former head of AOL Jonathan Miller began running MySpace’s

digital operations, and rumors went around that Miller was planning on replacing

MySpace’s executive team after the rumors were initially reported by techcrunch.com

here.10 It didn’t take long for new management to take over Anderson’s and DeWolfe’s

positions.

Alongside these rumors, DeWolfe and Anderson began clashing with Ross

Levinsohn, who at the time ran Fox Interactive Media and was in charge of MySpace at

News Corp over differences in how DeWolfe and Anderson were running MySpace and

what Levinsohn at News Corp had in mind for the company and how he planned on

running it (ft.com). Levinsohn ended up hiring his own team to speed up the MySpace and

News Corp merge.

In February of 2011, MySpace was put up for sale by News Corp, and ended up being

purchased by Time Inc. through Time Inc.’s acquisition of Viant Technology, a parent

company to Time Inc.11Despite MySpace still having daily traffic of about 21 million visits

each month, people have been questioning whether it still exists for awhile, and while

10 https://www.theguardian.com/media/2009/apr/23/chris-dewolfe-myspace
11 http://variety.com/2016/digital/news/time-inc-myspace-viant-1201703860/

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Facebook boasts 864 million active users each day worldwide, it’s understood why that

question is being asked.12

MySpace started out at the forefront of social networking, piggybacking off of the

skeleton of Friendster.com and adding an interactive piece that ultimately created and

paved the way for social media as we know it today. However, it seem as though initially,

the two main founders of the site were interested in creating something cool and useful

without really knowing how quickly it would take off, even though they had a plan

outlining where to start and that they hope to take MySpace to an international level.

The reasons for MySpace’s drop off can be summed up in these three points:

1. A clash between MySpace and News Corp company cultures/constant

change in management from News Corp

2. MySpace staying stagnant in a new era of change as a result of clashing

company cultures

3. MySpace employees–specifically the executives–felt their jobs were being

threatened, ultimately prohibiting creativity and growth for the website

Culture Clash: News Corp’s purchase of MySpace, along with the implementation of

a couple new c-suite-level management figures, ended up pushing out the two brains

behind the site, ultimately leading to Myspace’s downfall. After News Corp acquired

12http://www.huffingtonpost.com/2015/01/14/myspace-is-back-from-the-dead-to-
haunt-you_n_6472868.html

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Final MySpace Case Study
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MySpace Levinsohn wanted to reinvent its culture, to which DeWolfe and Anderson did not

respond well to. The two MySpace creators knew what they wanted to achieve and had a

vision about how to make it happen. Whether Levinsohn felt pressure from Murdoch to

make something happen or he is just a workhorse and likes things done a certain way is

unclear. But regardless, MySpace executives were used to working in a way that Levinsohn

didn’t agree with. This created a lot of tension between Levinsohn and DeWolfe and

Anderson. Shortly after, Levinsohn was replaced from overseeing MySpace by his cousin

Peter, a veteran of Fox TV (ft.com).

Staying Stagnant: Whether MySpace executives felt they were being bombarded

with a whole new culture or whether they didn’t anticipate Facebook to take the social

media world by storm, MySpace continued catering specifically to the audience it started

with. Plenty of factors could have contributed to MySpace becoming obsolete, but at the

end of the day, there was very little adaption to change, and this is one of the main reasons

MySpace is not currently competing with Facebook.

Especially now that Facebook is the starting point for social media, it paved the way

for media as a whole to be the constant change among news, technology and just overall

usage. It has created something destined for constant change and MySpace could not keep

up.

Despite the issues MySpace faced when News Corp purchased it, it’s very possible

that MySpace executives could have caught these changes in the industry early, even so to

the point where they could be currently competing with Facebook and Twitter.

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Final MySpace Case Study
July 5, 2017

Threatening Jobs: Techcrunch.com wasn’t any help for MySpace in this situation.

The article hyperlinked on page five was the beginning of the rumors that News Corp

would be taking over after they purchased the website and would no longer be letting

MySpace executives continue to run the company as they saw fit. When the executives

heard about this, ultimately they decided it would be better to step down than to be pushed

out of their own company.

Afterthought-

When News Corp purchased Myspace, Murdoch hardly knew what it was because he

called Levinsohn–who oversaw foxsports.com at the time–asking whether it would be a

good investment, to which Levinsohn said it would be.

It doesn’t seem as though News Corp really had a plan for what they hoped to gain

from purchasing MySpace, except that Murdoch thought it to be a good investment when he

was looking to span more into the online market for advertising and bringing more web

traffic to News Corp websites. But when it all panned out, News Corp’s constant push to

add more advertising was for News Corp’s gain, not MySpace’s. There was little to find

about what News Corp wanted from purchasing the website. After it was decided

Levinsohn will oversee MySpace it all went downhill. Instead of trying to get a good idea

about how the site works and how it can be used Levinsohn went in pushing his

expectations onto the executives of MySpace fully expecting them to go along with it all.

Since the company cultures of both MySpace and News Corp were completely different this

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Final MySpace Case Study
July 5, 2017

created a lot of tension between Levinsohn and DeWolfe and Anderson. Levinsohn never

tried to get a good read on the executives, or the work they were trying to accomplish. Nor

was there any kind of compromise made between the two sides for a potential gain for both

of them.

DeWolfe and Anderson hoped that one day MySpace would become an international

social media platform where users across the world could communicate and share pictures

and music. The site blew up very shortly after it launched. There were tens of millions of

unique views daily, so whatever MySpace management was doing seemed to be working.

It’s easy to say that MySpace just couldn’t keep up with Facebook, and that’s why you never

hear about it anymore. Although that is true, and it may be the case, MySpace executives

were not given the opportunity to focus on MySpace and its growth after News Corp’s big

purchase.

After Levinsohn came his cousin, then Jonathan Miller of AOL, and then the former

COO of Facebook. Management on News Corp’s part was constantly changing and it seemed

as though each manager had the same mindset: to acquire MySpace and make it part of

News Corp with a complete disregard of DeWolfe and Anderson. After techcrunch.com

published its article, DeWolfe and Anderson could no longer focus their energy on

MySpace, but were worried about whether they would get pushed out by News Corp. They

felt their positions were being threatened, and therefore, the whole situation ended up

being counterproductive to the growth of MySpace, all while Facebook is swooping in from

the outside.

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Final MySpace Case Study
July 5, 2017

News Corp’s management ended up pushing DeWolfe and Anderson out without

formally firing either of them. This left News Corp with a booming social media site and no

one to run it. What happens to MySpace after this is history. News Corp was left with an

almost useless social media platform–especially with Facebook’s popularity–that nobody

knew how to use.

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