LOS ANGELES — MySpace, once the dominant social
networking site on the Internet but now an afterthought to Facebook,
will be sold to Specific Media in a deal worth $35 million in cash and
stock, a person familiar with the matter said.
The acquisition by the Irvine, Calif.-based advertising network is expected to be completed Wednesday.
News Corp., which acquired MySpace in 2005 for $580
million as part of a bold digital strategy, plans to retain a small
stake in company. The media conglomerate had hoped to fetch as much as
$100 million for the site, which has been steadily shedding users and
advertising revenue in the past several years.
The sale marks a significant fall from grace for
MySpace, which once commanded a billion-dollar valuation and was the
premiere online hangout for musicians, actors and their fans to
interact. But the site peaked in popularity in October of 2008 with 76.3
million users. The number of monthly visitors has since dwindled to 35
million in May, according to ComScore Digital Analytix.
Other potential bidders for the site included MySpace
co-founder Chris DeWolfe and an investor group that was courting a
personal investment from Activision Blizzard Inc. Chief Executive Bobby
Kotick.
The little-known new owner Specific Media was founded
in 1999 by Tim Vanderhook and his brothers, Chris and Russell. The firm
helps companies distribute advertising online, on mobile devices and on
Internet-connected televisions.
Specific Media wants to return the site to its roots
as a place for music fans to discover new bands and songs, according to
the person familiar with the matter, who asked not to be identified
because the negotiations are private.
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