The Wall Street Journal has reported that News Corp plans to sell MySpace very soon, in a deal that would see more than half of the company's employees laid off.
News Corp bought MySpace in 2005 for nearly $600. It reached a peak valuation of $1.5 billion just one year later and was dubbed "one of the best acquisitions ever," by a M&A expert Tom Taulli, in a Businessweek article that also suggested MySpace would grow by 20 percent per year.
Companies were arguing over the company, and shareholders of Intermix Media, which sold the network to News Corp, were up in arms, furious that the company would sell off such a hot property for so little.
MySpace's traffic has since plunged. Its user base has plummeted. Its profits have been replaced by losses. Its employee count has diminished. And now News Corp is on the verge of unloading the company for as little as $20 million—or about 1 percent of its peak valuation.
MySpace made big mistakes, like not adapting, like not taking competitors seriously. But Facebook or Twitter or LinkedIn or Groupon or Google could all make the same mistake. Tech titans need to remember that they are not invincible, and their consumers aren't as loyal as they may like to think.
This is a woeful tale that other companies would be wise to take a lesson from. Because after the dead social network sells, everyone's gonna be asking, "Who will be the next MySpace?"