New York — MySpace, the pioneering social networking website owned by News Corp., reportedly plans to slash more than half of its workforce on Tuesday as the website scales back its social networking ambitions, according to a person familiar with the matter, as the business continues a major strategic overhaul aimed at buoying its dismal financial performance.
According to various reports the layoffs could extend to 600 people (of the site’s current staff of 1,000). Reports of workforce cuts have been swirling around for weeks, including one earlier Monday by AllThingsD, a site owned by News Corp., which also owns The Wall Street Journal.
MySpace will reportedly twist the news as “restructuring” to shed “legacy” products. After that, News Corp. will set to work on selling the site–perhaps even to Yahoo–All Things D reports.
The layoffs are not all that surprising now that MySpace has given up on competing with Facebook. Last October the site unleashed a redesign that nearly abandoned the format of friend pages and wall posts. The new MySpace is focused on actively discovering new music and videos, a concept that barely a few people, outside of a small demographic, have much time for.
It is the latest sign of the dramatic decline in MySpace’s fortunes since it was acquired by Rupert Murdoch’s media conglomerate News Corp. in 2005 for $580 million, and since then has been eclipsed by Facebook Inc., and the company has struggled financially as its audience has shrunk. Facebook had nearly 154 million unique visitors in December, more than triple the number of visitors to Myspace, according to comScore. AllThingsD is also owned by News Corp.
Sadly enough, if the report about the new layoffs turns out to be accurate, this will not be the first major restructuring for MySpace. In June 2009, the company slashed 30% of its workforce, which left it at its current number of 1,000 employees.
MySpace did not immediately return a request for comment. The person familiar with the situation said Tuesday’s job cuts will reflect Myspace’s shift toward its new strategy, but could provide no further details.