Social networking site MySpace will slash 30% of its workforce in an attempt to cut costs and return the site to more of a “start-up culture”.
It is the first major corporate restructuring move since former Facebook executive Owen Van Natta took over the chief executive role from MySpace co-founder Chris DeWolfe in April.
MySpace said in a statement yesterday that around 400 workers will lose their jobs, leaving 1000 employees in the site’s total workforce.
“Simply put, our staffing levels were bloated and hindered by our ability to be an efficient and nimble team-oriented company,” Van Natta said, adding that the restructuring should help the site “return to an environment of innovation”.
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“I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace.”
The move is likely a response to the popularity surrounding micro-blogging site Twitter and social networking giant Facebook, both of which are passing MySpace in web-traffic and media coverage.
A recent ComScore survey shows that Facebook has reached 307.1 million users worldwide compared to MySpace’s 126.9 million users worldwide. But recent Nielson Online figures show the site dropped 400,000 users between 2007 and 2008.
The site has also seen disappointments in revenue growth. Owner News Corp missed its own target of $US1 billion in revenue by June 2008.
Revenue for News Corp’s Fox Interactive division, of which MySpace makes up the biggest part, fell by 16% in the quarter ending 31 March. News Corp does not break down individual numbers for the site.
News Corp’s digital media chief, Jonathan Miller, has since commented that MySpace “grew too big considering the realities of today’s marketplace.”
Internet, Web 2.0, Information Technology, Sales, Social Networking, MySpace, Facebook, Twitter, News Corp, Jonathan Miller, ComScore, Nielsen Online, Chris De Wolfe, Owen Van Natta