News Corp. sells Myspace for $35 million

Ailing social network Myspace has been sold by News Corp. to advertising network Specific Media for $35 million, the All Things Digital technology blog reported on Wednesday. The News Corp.-owned Silicon Valley blog said the deal includes slashing about half of Myspace's staff of between 400 and 500 people. News Corp., which bought Myspace in 2005 for $580 million, would retain a five to 10 percent stake in the social network, All Things Digital said. It said the deal was being completed on Wednesday although it has not yet been officially signed. A Myspace spokeswoman contacted by AFP said: "Nothing officially has been announced regarding the transaction." According to the News Corp.-owned Wall Street Journal there were two leading bidders for Myspace -- the digital ad-targeting firm Specific Media and private equity firm Golden Gate Capital. Myspace was the leading social networking site when it was bought by Rupert Murdoch's News Corp. six years ago but it has since been eclipsed by Facebook. News Corp. chief operating officer Chase Carey put Myspace on notice in November, saying the losses at the social network were "unsustainable." News Corp. does not break out results for Myspace in its earnings but the "other" segment, which includes the social network, reported a second quarter operating loss of $156 million, $31 million wider than a year earlier.