MySpace: Are The Rats Abandoning Ship?
By Anna Johnson on March 10th, 2009TechCrunch’s Michael Arrington raised an interesting question last week: is the departure of several key executives from the News Corporation owned MySpace akin to the rats leaving a ship that is, if not sinking, about to encounter a severe storm?
While it’s somewhat common for individuals to leave a company for personal reasons or to start their own enterprise, Mr Arrington points out that when a group of senior executives leave, it may be a sign ‘that a company is about to go sideways, or worse.’
Last week, MySpace’s chief operating officer, senior vice president of product strategy, and vice president of technology, left the company to take a break and begin a new company. Michael Arrington suggests their exits from MySpace, and the timing of those exits, indicate that MySpace may be in trouble.
While MySpace is still the biggest social network in the U.S., Facebook eclipses it worldwide, and is likely to be bigger than MySpace in the States by the end of 2009.
Arrington says MySpace has made a number of strategic mistakes and is mired in a ‘ridiculous corporate structure’. MySpace is merely one part (albeit the major part) of the Fox Interactive Media (FIM) group within News Corporation.
We’ll likely know more when the employment contracts of MySpace’s founders Chris DeWolfe and Tom Anderson come up for renewal later this year. If they leave, then MySpace will have lost the fuel that got it to where it is now.
Whether News Corp. can maintain the momentum – and more importantly build on that momentum to stop Facebook rendering it redundant – will then be seen.
There are certainly no guarantees, despite MySpace’s current might. We need only think of Netscape, which was the pioneering and once the leading web browser.
After a series of missteps, and a losing battle against Microsoft’s Internet Explorer, Netscape ended up being sold to AOL… where it seems to have been recycled and attached to a number of different initiatives. A far cry from its hey day…
Will MySpace follow the same path? Let’s hope not!
Source: Michael Arrington,”The Smart Execs Leave Before The Fall,” TechCrunch, March 4, 2009
