The shock departure of Owen Van Natta, MySpace’s chief executive, a mere nine months after joining the business, has once again thrown the future of the depleted social networking site into the harsh limelight.
Van Natta, largely considered a safe pair of hands especially after his tenure at major rival Facebook, was meant to bring about the drastic changes the $580 million News Corporation owned company needed. Certainly when I he spoke to the Telegraph four months ago, he was brimming with optimism that MySpace could shift focus away from being a social network and become a platform “where people socialise around content”. He wanted it to become the place people found and shared music, TV, film and games content online.
However, despite a lot of the right noises, such as the acquisition of iLike (the social music recommendation app), the roll out of MySpace Music and the addition of genuinely useful tools for artists – such as Dashboard, the shift to differentiating itself from Facebook has just not happened.
And Van Natta, the man whose high energy levels saw him dubbed “superman” by some MySpace colleagues, has essentially failed to bring about that much-needed change. However, nine months in any industry is not much time to reinvent a business and produce results. If the site does ever manage to reinvent itself as a ‘social content’ platform, Van Natta’s foundation-laying could earn him some belated kudos.
But regardless of who is leading the company or the circumstances during which Van Natta left – both immaterial to the MySpace user – how can MySpace hope to become significant once again and generate a good income for Rupert Murdoch? Or are we to believe the bleak prediction of former Wall Street darling Henry Blodget, who said in his blog last October that “MySpace might actually be worth next to nothing” and that instances in which a former world-beating online company has “lost its mojo and then come roaring back to health are rare”.
Om Malik, a business journalist and technology blogger, thinks MySpace’s days are numbered and it is now “circling the drains”. Talking about Van Natta’s recruitment in April 2009, he said: “What the company needed was radical transformation. But what it got was infighting, politicking and constant contraction. At the time Van Natta, Jones and Hirschhorn joined the company it had two things going for it -– the audience and the social graph. There was a time when celebrities used MySpace to stay in touch with their fans. Now they’re all using Twitter.”
It was clear when Van Natta talked about tearing up the previous management’s strategy plan – that even News Corporation had accepted that MySpace had to reposition itself after Facebook stole the social networking momentum. The most recent Nielsen figures speak for themselves – in the UK in January 2010, MySpace had 3.9 million unique users compared to the mighty 23.9 unique users visiting Facebook during the same month. Even in the US where MySpace has always been historically bigger, 51.6 million unique users visited MySpace last month – versus a whopping 116.3 million using Facebook.
However, the idea that MySpace might have already started to lose of grip on its music and celebrity audience, an area still not dominated in the same way by any other site – must be rather unsettling.
Mark Mulligan, vice president, research director at Forrester Research who focuses on music and digital media, does not think all is lost and believes that MySpace needs to totally abandon the social networking side of the site to focus on the services it offers musicians and other creatives.
“I think MySpace hasn’t really got a lot left other than music –as the majority of social networking has moved beyond the site – mainly to Facebook.
“However it is still a number one destination for musicians and fans. This is an area sites like Facebook have faled to replicate – with attempts at things like ‘fan pages’. Twitter is nothing more than a good extension of the conversation between artists and fans, but fails to offer anywhere near as a good a rich multimedia experience as MySpace.”
Mulligan believes all investment into the site needs to go into making the interface neater, improving the quality of music and video that can be uploaded and simply making the whole platform more elegant as a content host. He also doesn’t think the music and content sharing expertise of the iLike management has been used enough.
Nate Elliott, a principal analyst at Forrester Research – who focuses on social media, thinks a more strategic balance has to be struck between creating a social networking experience and content networking experience – in order to avoid alienating the millions around the world – who still in fact use the site as a social network. “It’s easy to forget that MySpace still attracts millions of users per month – even if its not as many as in its heyday – or as many as Facebook. These people have built their lives on MySpace and if it suddenly stopped servicing them, the figures would drastically drop.”
“Clearly MySpace is a troubled property – and its innovation levels have lagged behind Facebook – but it has to tread carefully when re-establishing itself.”
Elliott thinks MySpace should not focus any time or money on the social networking part of the site – letting those users drop off naturally – and instead ramp up investment and innovation around the music side.
Then, he says, the dead–weight users who are actually costing MySpace money in bandwidth, will depart – leaving a smaller more valuable audience – which can be monetised with greater ease and efficiency. However, although Elliott is not convinced that there are actually enough users interested in having a music/content-only network in their lives – he does think MySpace has to try this route as it has very few alternative options.
Mike Jones, previously MySpace’s chief operating officer and Jason Hirschorn, the former chief product officer – who now find themselves elevated to co-presidents– obviously have their work cut out for them. But if Van Natta’s tenure is anything to go by – they probably have less than nine months to make a final attempt to turn MySpace’s fortunes around.
Richard Titus, chief executive of Associated Northcliffe Digital (which owns sites such as MailOnline, FindaProperty.com) said: “I think the digital ecosystem for rich media (audio and video) consumption and discovery is terribly immature. There is a real opportunity for leadership particularly around [content] discovery and social behaviours.”