MySpace to lay off 30 per cent of staff

Jun 16, 2009, 19:00 GMT

Los Angeles - Social networking site MySpace is to lay of 30 per cent of its staff in a cost cutting measure designed to help it compete with the rapid growth of rivals like Facebook and Twitter.

The company, which is part of media magnate Rupert Murdoch's News Corp, said Tuesday that the cuts would leave it with a workforce of around 1,000 employees. Murdoch bought MySpace for 580 million dollars in 2005, when it was the leading social networking site on the web.

'MySpace grew too big considering the realities of today's marketplace,' said Jonathan Miller, News Corp's CEO of digital media. 'I believe this restructuring will help MySpace operate much more effectively both structurally and financially moving forward.'

Owen Van Natta, a former Facebook executive brought in to run MySpace in April, said in a press release that the MySpace organization had become 'bloated.'

'I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace. Our intent is to return to an environment of innovation that is centred on our user and our product.'

Last year Facebook overtook MySpace as the site with the most worldwide users. On Monday, a new study by a web tracking firm revealed that Facebook had also passed MySpace in the US for the first time, pulling in 70.278 million unique US visitors in May, compared to 70.237 million visitors to MySpace.

Last May, Facebook had 36 million unique US visitors compared to 73.3 million for MySpace. Worldwide, Facebook had more than 307 million users in May, compared to MySpace's 123 million.