Kara Swisher

Recent Posts by Kara Swisher

The Flixster/Rotten Tomatoes/MySpace Mystery Solved: A Christmas Miracle!

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About 10 days ago, there was a post in this column about interest by News Corp. and its MySpace unit in Flixster, the popular social networking site for movies.

In the post, titled “MySpace and News Corp. Eye Flixster (But for What?),” I wrote:

Whether this is an acquisition or more of a larger partnership deal with News Corp. digital entertainment sites is unclear. Several sources said a purchase was a possibility, while others talked about a more complex deal that did not necessarily mean a purchase.

Sources said any such deal is not imminent, but that News Corp. (NWS) itself has been conducting extensive due diligence on the San Francisco-based Flixster, part of a plan to combine it with Rotten Tomatoes, another News Corp.-owned site run by its IGN Entertainment division.

Well, BoomTown did more gumshoeing and it is indeed shaping up to be a very complex deal, according to many sources I spoke with, centered on Rotten Tomatoes merging with Flixster in exchange for a stake in the combined independent company by News Corp.

Flixster has attracted a huge audience–upward of 50 million–which trades all kinds of recommendations, ratings, news and even post user-generated movie reviews on the Web site and via widgets on social networking sites, mostly on Facebook.

Founded in 2006 by CEO Joe Greenstein and CTO Saran Chari, Flixster has raised $7 million in funding from Lightspeed Venture Partners and Pinnacle Ventures, as well as garnering an angel investment from Silicon Valley entrepreneur and LinkedIn founder Reid Hoffman.

certifiedfresh_logo_300flixster

Rotten Tomatoes features mostly premium content, including professional reviews, trailer videos and news. It has a community feature in beta, so it would be a nice fit with Flixster.

In addition, in a separate but related deal, the resulting company could have its social, user-generated and premium content threaded throughout MySpace, which is in the midst of transforming itself from a social networking site into a social media site for music and other kinds of entertainment.

Several sources noted that this deal being contemplated is typical of the overall strategy at News Corp., which has been targeting digital units that are not an obvious fit inside the company any longer for sale or other disposition.

In fact, the deal is not unlike one News Corp. did recently, flipping photo-sharing Photobucket into mobile photo service Ontela, with the media giant holding a large equity position in the the new entity.

The possibility of linking MySpace and the combined social movie site is interesting and yet another signal of one of the new strategies of MySpace: “Playing on other platforms,” as one source described it.

For example, MySpace recently announced it was adding its data stream to real-time search results on Google (GOOG).

And, it seems dead obvious that MySpace is likely to adopt Facebook Connect sooner than later, perhaps beginning with a smaller implementation early next year.

Focusing less on Facebook, which has long surpassed the once high-flying MySpace as the top-of-mind social network, MySpace is likely to value the massive cross-distribution for its much richer media content.

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But that’s not all for MySpace, said several sources, all of whom noted that the site will be rolling out a range of significant design and other feature initiatives over the next 45 to 60 days.

These are all aimed by its new managers at juicing MySpace’s prospects, which have declined over the last several years, as have both revenue and engagement with consumers.

“This is not a rocket-ship ride to the moon,” said one person with knowledge of the situation. “It’s building again step by step.”

A Flixster spokesman declined to comment, as did News Corp. I am awaiting a call back from MySpace’s spokeswoman, but she is stuck in a security line at the airport.

Happy holidays, anyway, Dani!

(Full disclosure: News Corp. owns Dow Jones, which owns this site.)


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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work