Sick Man Of The Internet: MySpace For Sale

In the latest development of the stumbling Ottoman Empire that is MySpace, Wall Street Journal reports that parent company News Corp. (which also owns WSJ) is putting the social network up on the auction block. News Corp. bought MySpace’s parent company eUniverse in 2005 for $580 million.

TechCrunch got hold of the “pitch book” earlier this month, which is bleak and more bleak. For 2011, expected revenue for MySpace is $109 million, with $274 million in expenses, for a loss of $165 million. Next year, though, the pitch says MySpace should turn a $15 million profit with $84 million revenue and only $69 million in expenses.

The decision to sell MySpace was announced in February in an earnings call with investors. It follows MySpace’s launch of a music analysis tool called Music Meter, which aimed to make music discovery more sophisticated on the website and also tap into the growing trend of analyzing social media influence in the music space.

Perhaps more significantly, though, the sale of the company comes on the heels of a re-launch last November that hoped to reposition MySpace as an entertainment portal rather than as a social network. MySpace’s relaunch was a surrender to Facebook in the battle over the social graph. The partnership allowed users to log in to MySpace using Facebook Connect, and MySpace hoped users would use the site primarily for listening to music and other media content, rather than social networking.

According to WSJ, bidders for MySpace, which the current owners hope will fetch a price around $100 million, include Thomas H. Lee Partners, Redscout Ventures and Criterion Capital Partners LLC. What said bidders will do to turn MySpace around is the question that remains on everyone’s mind.