Former Myspace CEO Mike Jones is doing something similar — but he’s not stopping there.

Jones’s new Santa Monica, Calif.-based “technology studio,” called Science, will incubate ideas in-house, invest in other people’s start-ups, advise Silicon Valley companies on breaking into Hollywood, and maybe even look into reworking later-stage Internet companies like Yahoo.

To start, Jones has raised $10 million from investors including Rustic Canyon, White Star Capital, the Social+Capital Partnership and Eric Schmidt’s Tomorrow Ventures. He has also lined up three private equity partners for potential larger deals.

Why call it “Science”? Jones told AllThingsD this week: “I’m choosing to build a series of successful businesses with talent that I’m familiar with, and a method that we’ve proven works.” He added, “We’re at a point in our industry where it’s a little more science than art.”

Science will start with three verticals: The intersection of content and commerce, social systems, and mobile and location.

Prior to Myspace — which he joined in 2009 and wasn’t able to revive before selling it to Specific Media earlier this year — Jones had founded companies such as Userplane (sold to AOL) and Tsavo Media (sold to Cyberplex).

Also in the L.A. start-up scene, a new accelerator called Start Engine debuted earlier this week, promising it will focus on mentorship and accept 120 start-ups per year. The first class kicks off in January.

First photo by Flickr user Discover Science & Engineering.

“Google doesn’t get social” was the theme of the past few years — a technology business so algorithm-focused, it could not possibly understand the mindset of the “social” consumer. Google+ now challenges that basic premise and begs the question: Is it possible that one company that has been so superior at search, so relentless to dominate video, so focused on performance advertising — can also be good at social?

To understand Google+, we first need to recognize the term social networking as a completely inaccurate representation of what these products are. A digital city is a better illustration. If the Internet represented a planet, the browser a continent, then social networks are cities. These are virtual locations where you have “residence.” It’s where you spend time and money and can find friends and businesses.

Let’s explore what it means to move into Google+ and what historically difficult social problems it is trying to solve.

Welcome to your new hometown, Google+

Google+ is a new digital city. I have apartments in Facebook, Myspace and Twitter — and I just leased a new apartment in Google. I moved my photos there and created a new address book for my friends in this city. Now, I am spending less time in my other apartments.

The nice thing about my home on Google+ is that it is not surrounded by old friends and acquaintances like my other residences. I don’t have 2,000 people knocking on my door — people whom I lost interest in keeping in touch with a long time ago.

The other nice thing is that moving is actually not that tough. Yes, my last landlord blocked me from taking my address book, and in certain cases I had to rip my pictures that hung on the wall. It was a bit painful but the move got done.

My new town of Google+ with Mayor Bradley Horowitz has similar rules as the other towns. I have to keep my walls white, I need to use my real name and it doesn’t allow illicit activities. I do have to categorize all my friends, which takes a little time. There are a lot of smart people in Google+ Town, so I have to watch what I say. There are no arcades and I can’t buy anything there yet, but I am sure these will come. I can check into my news on their Sparks newsstand. And if I want to meet people right now I can open my own “hangout” and invite people.

When I go back to Myspace, I can of course decorate my room more, listen to music, and, frankly, talk about what I want — and I don’t have to use my real name. And on Facebook, I have more friends and family there right now and I like the city Zarcade.

But the new Google+ Town has a lot of great amenities that are attracting my attention:

Circles: Preventing Social Graph Overgrowth

Social graphs tire over time, you end up with too many friends. Through categorization, Google believes it can make your stream more accurate and relevant and maybe help you determine grouping for other services, like email or document sharing.

This also helps you feel comfortable sharing, which is probably the most important consequence of grouping your friends. I can now be 100 percent certain that the photo from last night goes to friends and not family members or colleagues.

Friends versus Followers — Why Not Both?

With Twitter, we have asynchronous friendships in that someone can follow us but we don’t need to follow them. Facebook and Myspace have synchronous friendships. Google+ allows both. Facebook also addresses this with their Pages product, where you can have asynchronous relationships.

It is all the social benefit of touting how big your follow base is on Google+, without any of the stream clutter of forcing everyone to be friended together.

Free News Now! Sparks Integration as the Future of News

Although Sparks feels raw today, it seems to be positioned as the next way for people to consume news. It’s a topical feed-based system that lives on your Google+ homepage and allows you to track any topics you are interested in and quickly consume snapshots of those topics without visiting the full article.

With Google+, Google has shown it can build a social product platform, but now can it build a community?

I was at a party the other night and someone was telling me about prebuilt cities in China — completely vacant, fully built cities that are just waiting for a population to settle there. Google has built its city, it has initial inhabitants, the basic infrastructure is sound and everything looks fine. Now the question is: Will you homestead there? Are its laws better than the laws of your old city? Do you like its amenities? Can it feel like your home?

Right now, I’m keeping all my apartments, but it will be interesting to see where I decide to spend my weekdays versus weekends, my work versus home time, which apartment I visit today, which city I invest more in over time. Maybe all of them … and now that I’ve moved once, it wouldn’t be hard to move again. But I believe Google+ Town has a fighting chance and I am eager to see its growth.

Mike Jones is an Internet executive, investor and advisor located in Los Angeles. A longtime entrepreneur, Mike founded his first successful Internet company in college and since then has founded, built and sold numerous online and mobile businesses. Most recently, he served as the CEO of Myspace.

Closing another chapter on one of the Internet’s most iconic properties, Myspace has been sold to to Specific Media, an advertising network, for $35 million.

Sources close to the situation said the deal is being completed today, although it has not been officially signed. Myspace’s owner, News Corp., will hold on to a very small stake of less than five percent.

[UPDATE: It's official; see the press release and memo to Myspace employees from outgoing CEO Mike Jones below.]

AllThingsD broke news of Specific’s interest in Myspace yesterday.

The price is well below the $100 million that News Corp. had been hoping for, and a chasm away from Myspace’s one-time billion valuation.

The deal includes a halving of Myspace’s staff of 400, as well as other cost cuts. It’s likely Jones and other top staff will remain only for an interim period.

News Corp. bought Myspace for $580 million in 2005, and made that back via a lucrative advertising deal with Google when the social networking site was flying high.

But that was another time — the media giant has been trying to sell the site before the end of its fiscal year, which falls on Thursday, in order to get it off the books.

There were several other bidders in the process, including separate efforts by the two co-founders of Myspace, Chris DeWolfe and Tom Anderson.

More recently, the preferred acquirer was a group that included Activision CEO Bobby Kotick, but it fell apart over a number of issues.

This week, it came down to Specific and also a private equity firm, Golden Gate Capital.

According to a report yesterday in The Wall Street Journal:

Founded in 1999 by Tim Vanderhook and his brothers Chris and Russell, Specific Media helps marketers buy digital ads across the Web, online video, mobile and even the TV. The Irvine, Calif., company got its start brokering ad space for websites and quickly moved into the fast-growing business of collecting and using Web browsing, demographic, geographic and other profile information about consumers to target ads. The company now ranks among the largest online advertising networks in the country, reaching 170.9 million unique U.S. visitors in May, or about 79% of the U.S. Internet users, according to comScore Inc.

A Myspace deal would give the company access to data about Myspace users to be used for ad targeting. It also would transform the firm into a media company with its own ad space to sell instead of simply an online ad technology firm that brokers ad space on behalf of other websites.

Specific Media’s executive team includes knowledge of the inner-workings at Myspace, with two executives who previously worked at Fox Audience Network, News Corp.’s online advertising unit that sold ads for Myspace.

Specific Media has raised more than $110 million in funding, closing a $100 million round of financing from private-equity firm Francisco Partners in 2007. Since then, the company has acquired a couple of digital advertising companies, including online video company Broadband Enterprises and an Amsterdam ad technology company.

Here is the official press release and the memo to Myspace staff from Jones:

From: Mike Jones
Sent: Wednesday, June 29, 2011 11:26 AM
To: Myspace All
Subject: IMPORTANT COMPANY NEWS
Importance: High

Myspacers,

Today, we are announcing that Myspace will be acquired by Specific Media, one of the world’s leading online media and advertising platforms. Over the next few days you will be hearing from the team at Specific, including their CEO, Tim Vanderhook, regarding their exciting plans for Myspace and how it fits in with the overall vision of their company.

In conjunction with the deal, we are conducting a series of restructuring initiatives, including a significant reduction in our workforce. I will assist Specific with the transition over the next two months before departing my role as Myspace CEO.

I wanted to take a minute to thank you all for the incredible experience it has been to lead this company and to work closely with all of you over the past several years. While I regret we won’t be working together at Myspace any longer, I am very proud of the work we have done here and believe we have performed with excellence — even under extremely difficult circumstances.

My time here at Myspace represents the most engaging and challenging time of my professional career. I have found our team to be comprised of the best people I have come across in our industry.

You can read the press release below. Once again, thank you for all of your hard work and dedication.

Thanks,

-M

SPECIFIC MEDIA ACQUIRES MYSPACE FROM NEWS CORPORATION

Los Angeles, Calif. — June 29, 2011 — Specific Media, a digital media company, today announced it has acquired Myspace from News Corporation. As part of the agreement, News Corporation will take a minority equity stake in Specific Media. Additional terms of the agreement are confidential and will not be disclosed.

“Myspace is a recognized leader that has pioneered the social media space. The company has transformed the ways in which audiences discover, consume and engage with content online,” said Tim Vanderhook, Specific Media CEO. “There are many synergies between our companies as we are both focused on enhancing digital media experiences by fueling connections with relevance and interest. We look forward to combining our platforms to drive the next generation of digital innovation.”

Specific Media is an innovative global interactive media company that enables advertisers to connect with consumers in meaningful, impactful and relevant ways. Founded in 1999 by brothers Tim, Chris and Russell Vanderhook, Specific Media is currently headquartered in Irvine, CA and operates offices around the world.

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

According to sources close to the situation, News Corp. is down to one possible investing group in its quest to make lemonade out of the lemon that its Myspace social entertainment hub has become.

In the lastest of many scenarios considered, several sources said its owner, News Corp., will continue to own about 20 percent of Myspace. The main bidder is a dark horse bidding group, which includes Activision Chairman and CEO Bobby Kotick as one of the potential investors.

The deal, cautioned sources, is not final and could easily fall apart.

Interestingly, if such a deal is struck, he would apparently be involved as an individual and not for the giant gaming company, and would play no management role in the company.

Kotick would presumably need permission from Activision for such a high-profile investment, even if he played a smaller role.

Kotick’s possible involvement has not been mentioned in previous reports.

Sources said the other possible bidders — including music video service Vevo, a group including Myspace founder and former CEO Chris DeWolfe, an internal effort by current CEO Mike Jones, several private equity firms and even myYearbook — mentioned in past reports have not worked out for various reasons.

Vevo had seemed the likeliest winner, but its bid appears to have foundered for now, due to the complex nature of its music label ownership.

It is not clear what the price will be for Myspace, which was once the leading social networking site before the world dis-Liked it for Facebook.

One thing is certain: It is nowhere near the $100 million that News Corp. reportedly sought.

The site — even after an overhaul to focus on entertainment — has recently been losing money and traffic, although it is still a large destination on the Web.

News Corp. declined comment, as did Kotick.

Presenting at the webinar will be Myspace CEO Mike Jones–-who has been pitching Myspace as “a social entertainment destination” rather than a social network–-and Dan Rose, VP of Partnerships and Platform Marketing for Facebook.

Here are my live notes:

Mike Jones says the launch today is called “Mashup with Facebook.” Users can share a stream of entertainment content with one-click setup.

One million users engaged so far with Myspace Facebook through initial partnership of “Sync with Facebook,” which was launched in August to push user streams on Myspace to Facebook. Adding Facebook Like button soon.

Image to the right is Myspace’s special branding of its integration with Facebook Connect: “Mashup.”

Dan Rose: Every day 10,000 Web sites integrate with Facebook Connect, but this one is special. Adding users into the experience works when it’s naturally social in the offline world, and entertainment is social.

Rose says Facebook users will be able to take their Likes to Facebook as well.

Jones says this feature will be rolling out to the full Myspace audience today.

Rose says, “There’s nothing different about this implementation than any other Facebook Connect implementation or any other implementation of the Facebook Like button across the Web.”

Jones says, “We think this is a complementary offering to Facebook and other social platforms.”

Rose says it’s good that Myspace is focused on entertainment and Facebook is focused on being a social platform, and those things are different.

In the last couple of days (since the Facebook Connect option was rolled out on the Myspace signup page), metrics for people connecting with Facebook look good, says Jones, but he doesn’t specify. (He keeps saying things are good questions, and then not really answering them.)

There is no financial component to the relationship.

And that’s it! Pretty mellow.

Please see the disclosure about Facebook in my ethics statement.

Facebook VP Dan Rose

Presenting at the webinar will be Myspace CEO Mike Jones–who has been pitching Myspace as “a social entertainment destination” rather than a social network–and Dan Rose, VP of Partnerships and Platform Marketing for Facebook.

Myspace adding Facebook Connect has been rumored for so long you’d think it had already happened, so hopefully there will be more to the deal than that.

If things go as heralded, this will be the first Facebook announcement in a long time where CEO Mark Zuckerberg has not spoken for the company. Dan Rose is a former Amazon guy who joined Facebook in 2006. He has recently spoken on Facebook’s behalf about a partnership with Microsoft’s Bing to give it social data to improve search, and EA’s five-year exclusive Facebook Credits deal. Rose was previously Facebook’s VP of business development and monetization, and according to Kara Swisher was the main negotiator in Facebook’s failed effort to buy Twitter a couple of years ago.

Please see the disclosure about Facebook in my ethics statement.

But the troubled Web property is a…really troubled Web property, its News Corp. parent stressed today. And it needs to get its act together before it gets kicked off campus.

That’s the message that COO Chase Carey took pains to get across during his company’s earnings call this afternoon.

Revenue at Myspace was down $70 million compared to the same quarter a year ago, the company said, and “traffic numbers are still not going in the right direction, Carey said. Which means that its “current losses are not acceptable or sustainable.”

Okay. But Myspace has been in decline for some time, and Jon Miller and Mike Jones have been trying to fix it for more than a year. And last year at this time, we heard a similar assessment, only then Carey kept calling the site a “work in progress.” So how much more time do they have?

Carey: “We judge in quarters, not in years.”

My understanding is that when Miller took the job as News Corp.’s chief digital officer in the spring of 2009, he believed he had a real shot at fixing the social network, which had already cooled from red-hot to not at all.

But sources in and out of News Corp. tell me that Miller and his team are now merely hoping to patch the service long enough to find a buyer. Perhaps no one has told Carey, who seems to be conducting an anti-sales pitch.

——————-

EARLIER:

First look at Rupert Murdoch’s latest report card: News Corp. ended the September quarter with revenue of $7.4 billion and earnings of $0.27 a share (after factoring out a one-time tax gain). That’s almost exactly what the Street was looking for–expectations were $7.4 billion and $0.24 per share.

A quick run-through by unit:

• Cable: Up, because ad dollars are up and so are those affiliate fees that cable providers don’t want to pay but do.
• Movies: Down, because last year the company had an “Ice Age” movie in its results, and this year it’s fairly hit-less. It is making money selling reruns of “How I Met Your Mother,” though.
• Broadcast TV: Up, because local TV stations are doing better than last year, when they were still crippled by the recession.
• Satellite: Down, because costs were up.
• Publishing: Up, because newspapers are doing better than last year, when they were terrible. Ad revenue is up 13 percent worldwide. (This is where I note that News Corp. owns Dow Jones, which owns this site.)
• Random other stuff: Down, in large part because of Myspace and the rest of News Corp.’s digital unit, which is still trying to turn around.

I’ll come back to liveblog the conference call at 4:30 eastern, in the hopes that Murdoch says something interesting about politics, pay walls, the economy, Myspace, Apple and/or Google. He usually does!

LIVEBLOG:

BIG bummer: No Rupert on call today–because he’s traveling. (Some place with no phones? What’s up with that?)

CFO Dave DeVoe running through segment performance.

Cable: Some boasting about Fox News, FX, Big 10 Network, etc.

Movies: Nothing new here.

TV: TV stations up, but broadcast network losses up big “from higher cancellation costs.”

Satellite: [Apologies, had to duck out for a second.]

Newspapers: Again, ads up in all big newspapers.

Other/Digital: $70 million lower search and ad revenue at Myspace y/y.

Guidance: Leaving unchanged (though DeVoe notes that Myspace is still under plan).

COO Chase Carey:

Lots of focus on our retrans deals, and they are “critical” to our future. “We will be taking this business to a whole new level of profitability.”

Lots of growth ahead in International pay TV market.

Walk through of “key initiatives” throughout the company.

[Still sulking over Rupert-less call.]

Fox Film hasn’t had breakout hits, but no stinkers “in an industry known for them.”

We’ve got Jim Cameron locked up for Avatar 2 and 3, you know. And Modern Family is going to make us a pile of money in syndication.

Wish the World Series wasn’t such a bummer, and a short one. But NFL on Fox doing great.

WSJ still growing. Building digital business that “will take time to emerge.” “We feel very good” about subscription business in U.K.

“We’ve been clear that Myspace has been a problem.”

But relaunching “and we feel really good about” it. “Current losses are not acceptable or sustainable” and current management knows it, even though it’s not their fault.

But we know that we have to work very hard in coming months to get this thing sustainable.

[This is some of the most negative commentary I've heard yet from News Corp. on Myspace. Hard to sell an asset when you're describing it this way.]

Q&A:

Myspace: How much time do you give the relaunch to figure out if it’s successful. And what if it’s not?

Carey: We judge in quarters, not in years. Goal is to get to a place where top-line revenue is going in the right direction and “a clear path to profitability.”

We feel good about the relaunch. But “our traffic numbers are still not going in the right direction” and we have to stabilize that.

Fox TV content on digital platforms: It’s available on Hulu and Fox.com. How is that strategy going, and will you continue to be open?

Carey: Broadly: “This digital arena is still evolving.” We’re very focused on managing rights. Key issues: Windows, ad load, pricing. [Not answering at all, really.] “We think the digital arena is a very important one” particularly mobile, iPad, but “look, scarcity of our product is a real value.” But we’re learning as we go. “I do think it’s important that the digital platforms continue to develop dual revenue stream options.” That’s critical, and options are just beginning to evolve.

More on Myspace: There are a lot of operations in “other” besides Myspace: Mobile, Fox Audience Network, etc. What else could improve there?

Carey: Only two other businesses in there: Mobile, and outdoor networks, (and IGN). Not a lot of room for growth in those businesses.

So it’s really about Myspace?

Yes.

Avatar: What’s upside here?

Carey: Sequel to the most successful film ever? It should be pretty good! “Enormous events, without comparison or rival.”

[Please bring Rupert back!]

Please talk about terms of new Cameron deal?

Nope.

On retrans: Cablevision said they got better terms by holding out for a couple weeks. How do you react to that? If true, will we see more of these holdouts?

[Also a question about BSkyB I'm not that interested in.]

Carey: Mostly I saw Cablevision complaining that the government didn’t bail them out. But we feel pretty good about where we are. We didn’t think the government needed to get into it, and it would have been nice if the government would have been clear up front “it may not have gone off the air at all,” but whatever–”this was a matter to be dealt with between private parties.” [Ignore all those press releases we sent out!]

Can you talk about advertising trends and expectations?

DeVoe [I think]: They haven’t changed.

Cable margins: How long can you keep growing them?

Carey: We have room to drive a number of our channels, via more distribution, jacking up fees, advertising, etc.

What about getting more money from regional sports networks?

Carey: Won’t get into specifics.

[We want Rupe! We want Rupe!]

International channels seem to be doing well. Where is that growth coming from?

Carey: Part of it is the weak U.S. dollar. But overall, growth is “big and broad.”

Oh man. Even Chase Carey is yawning as he answers the question.

[Skipping accounting question.]

Back to network TV: Please talk about sports programming costs, etc. NFL, baseball, NASCAR. You spend a lot. Does retrans help support those costs? Or will you move some of that to cable?

Carey: I don’t think it makes sense to differentiate broadcast and cable much anymore. That’s the point of retrans–to make broadcast look like cable, with dual revenue stream.

On sports: It’s expensive, and draws big crowds. “It’s a unique strength in a world of DVRS” but “they come with big price tags.” We’d like to continue running it, but we have to do it at the right price.

Retrans does help, though–networks that are only ad-supported won’t be able to pay for these rights over time. Still, gotta be disciplined, etc.

Back to digital: What’s going on with Google TV? Are you thinking about different devices and different screens as a way to window, instead of calendar? I.e.: Make it available on PC but not on the big screen, etc.

Carey: I think within the house, the difference between screens won’t matter. I do think mobile is a discrete platform. [And some general chatter about tablets.]

But generally, “our content is incredibly valuable” and “we’re not going to throw it out there for everybody” unless we get compensated for it.

[Boring question about syndicated TV. Carey flipping through papers]

Hey, what about M&A deals, like Yahoo?

“Things like Yahoo are because the press needs things to write about.” [Zing! Also, hey, Jon Miller!] “We don’t need to make any acquisitions. But if there’s something out there, we should consider it, but we’ll do it in a very disciplined way” like we have in the past. Generally, we’d rather build than buy. “But if we see something we can acquire at a very attractive price that fits, we’ll take a look at it.” We’re not shopping.

[Skipping another cable channel question.]

Time for press Q&A:

How do you make broadcast look more like cable?

Carey: Retrans fees, like we’ve been talking about for the past couple years.

What about doing “premium video” (windowing movie release on TV?).

Carey: Looking at it.

What about further delaying movies to Netflix, Redbox beyond 28-day window (Warner talked about this today)?

Carey: We’re okay right now, but we’re looking at it. But as VOD grows, windows will change and evolve. But right now “we feel what windowing we’ve done has been good for us.”

Color on Apple TV 99-cent rental, please:

Carey: It’s pretty new. Only relevant for the past month or so. Too early to judge.

What’s your vision for European and British markets after you buy Sky? Will you buy Endemol?

Carey: Don’t really want to talk about it, too early.

Please talk about Times of London pay wall performance to date. Also, what are you thinking about your iPad newspaper in the U.S.?

Carey: Re U.K.: “We feel very good about it. Realistically, it’s very early….This is not something that’s a one or two quarter game.”

Same thing with the “whole digital arena” evolving, etc.

Hah. Refuses to talk about iPad newspaper. Which is not a newspaper!

Call finished, mercifully.

Mike Jones is perhaps one of the nicer Internet execs out there.

But, after much management turmoil at Myspace, it turns out the CEO is also the last man standing at the News Corp. unit, as it finally rolls out a new version aimed at reviving the troubled site.

That happened last night, as the yeoman’s work–under heavy pressure and intense scrutiny from inside and outside–done by Jones and his staff was finally launched.

The new beta version of Myspace moves dramatically away from its roots as a social networking site and distances itself from Facebook by becoming a “social entertainment” hub aimed directly at the Gen Y audience.

It’s a major niche play, in an arena Myspace was already well known for–with an emphasis on sharing and discovering music, television, movies, games, videos and photos from within and without.

As I wrote:

“It is a bold, if risky, move, which could result in a dramatic decline of users or–despite the grim reality of second acts on the Internet–reset Myspace to begin a new cycle of growth.”

Jones, a longtime digital entrepreneur, talks about all this and more in a video interview I did Monday at Myspace’s San Francisco office:

]]> http://allthingsd.com/20101027/saving-myspace-ceo-mike-jones-talks-about-rethink-relaunch-and-fingers-crossed-resurgence/feed/ 1 http://allthingsd.com/20100823/bain-leaves-news-corp-s-fan-which-will-be-integrated-into-myspace-the-internal-memo-of-course/ http://allthingsd.com/20100823/bain-leaves-news-corp-s-fan-which-will-be-integrated-into-myspace-the-internal-memo-of-course/#comments Mon, 23 Aug 2010 23:29:32 +0000 Kara Swisher http://kara.allthingsd.com/?p=32776

Adam Bain (pictured here), the well-regarded exec who ran the Fox Audience Network, called FAN, is going to Twitter to head up its early but increasingly aggressive advertising revenue efforts.

Here is the internal memo from News Corp. digital head Jon Miller about the changes at the ad network, in which it is clear the company is scrambling to shift strategy.

News Corp. (NWS) had been working on a plan for more than a year to spin off FAN and sell a piece of it to private equity investors, in part to hold onto Bain.

Now, it will go spinning back to MySpace, its principal source of ad inventory.

In his memo to employees below, Miller talked about the spin-off discussions, which failed principally due to issues over internal revenue share with MySpace.

Thus, back to the troubled social networking site, which is–after much exec turmoil–being run by Mike Jones. Jones has been trying to reinvigorate MySpace with a new look and a strategy focused on music and entertainment content.

Said Miller: “By aligning the FAN platform directly with MySpace, we will be able to utilize its services to further drive MySpace’s revenue efforts and to play a key part of the site’s planned re-launch later this year.”

News of Bain’s departure as FAN president–after a dozen years at News Corp.–to become a top exec at Twitter was first reported by TechCrunch earlier today, but without details of what would happen to FAN.

Bain also addresses his departure in the memo below.

First, here is the Miller memo:

Dear FAN employees:

I wanted to address the media reports this morning regarding Adam’s departure and also share some details on our plans for FAN moving forward. First off, Adam Bain will indeed be departing FAN–a company he has led from the ground up and built into one of the Web’s top five advertising platforms in just over two years. He has been an invaluable asset to this company and we wish him well in the future.

In addition, today we are announcing a plan to move forward with an integration of FAN’s team and technology directly with MySpace. As many of you know, we have had discussions with a number of interested parties in recent months with respect to potential partnerships involving FAN. After deliberating over these external options, we ultimately decided that the best path for FAN–and for News Corp.–is to put this leading-edge technology to work to benefit our existing assets. By aligning the FAN platform directly with MySpace, we will be able to utilize its services to further drive MySpace’s revenue efforts and to play a key part of the site’s planned re-launch later this year.

Bruce Wiseman will work closely with Mike Jones and Jack Kennedy on the overall MySpace integration efforts, and you will be hearing more from your managers shortly on details regarding the integration and how it will affect you. In addition, we will be sharing information broadly with you as much as possible over the next several weeks.

Lastly, I want to thank all of you for your commitment and dedication to FAN over the past two years–this is an incredibly talented team that’s accomplished a great deal in a very short amount of time. Also, please join me in once again thanking Adam for all his work–he will be missed both personally and professionally–and we look forward to crossing paths with him in the future.

Regards,
Jon Miller

And here is the Bain memo to his employees:

Guys–

I wanted to let you know that after 12 years at Newscorp, I’m moving on to pursue a once-in-a-lifetime opportunity in San Francisco.

As you can imagine, this is a pretty emotional decision and one that didn’t come easily. I’ve literally grown up inside this company and will always be grateful for the amazing opportunities that were afforded to me–the greatest among them: the opportunity to work with and lead this team.

The things we’ve done in the ad business–Self-Serve, Targeting, Segmentation and our work with big data–are too numerous to detail here, but they are industry-defining and have set Newscorp up to succeed for many years to come.

My deep thanks to Jon Miller–I’m humbled by the freedom and support given to me here at FAN. And lastly, I want to thank you, my team. I will miss the heck out of you, but I’m psyched to watch you continue to succeed, albeit from afar.

Bruce will be leading the company thru this transitional period.

Thanks again for all of your support and the privilege of leading this extraordinary group over the last two years.

–ab

Finally, here is the News Corp. official press release on the whole, well, messy thing:

MYSPACE AND FOX AUDIENCE NETWORK ANNOUNCE ORGANIZATIONAL INTEGRATION PLAN

MySpace to Leverage FAN’s Team and Leading Advertising Platform FAN President Adam Bain to Depart

Los Angeles, Calif.–August 23, 2010–News Corporation’s MySpace (http://www.MySpace.com) and Fox Audience Network (FAN) today announced a plan to integrate the FAN business directly with MySpace. The move will enable MySpace to leverage FAN’s team and its leading technology platform. In addition, FAN announced that its President, Adam Bain, will leave the company to pursue other opportunities.

“FAN and MySpace have worked together closely over the past several years and this integration will further align these two properties,” said Jon Miller, Chairman and CEO of Digital Media for News Corporation. “Adam has been an invaluable asset to News Corp, having led FAN’s growth from the ground up into one of the Web’s largest ad platforms, and we wish him well in the future.”

“By fully integrating FAN’s platform and team, we are in a great position to further leverage FAN’s technology, which allows advertisers to serve the right ad to the right person and apply that to content across MySpace to provide a more relevant experience for our users,” said Mike Jones, President of MySpace. “The FAN team is incredibly talented and we’re excited to welcome them to the MySpace family.”

Fox Audience Network was created in 2007 and currently reaches more than 150 million Internet users. The company leverages proprietary advertising technology to create highly-targeted advertising campaigns for a wide range of marketers, while also delivering cutting-edge tools and services to third-party publisher partners, advertising agencies and research companies.

]]> http://allthingsd.com/20100823/bain-leaves-news-corp-s-fan-which-will-be-integrated-into-myspace-the-internal-memo-of-course/feed/ 0 http://allthingsd.com/20100617/myspace-co-president-jason-hirschhorn-leaves/ http://allthingsd.com/20100617/myspace-co-president-jason-hirschhorn-leaves/#comments Thu, 17 Jun 2010 21:15:50 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=20693 Jason Hirschhorn joined MySpace a little more than a year ago as chief product officer. In February, he was put in charge of the ailing social network, along with Mike Jones. Now he’s out.

TechCrunch reported the move this afternoon, and I’ve confirmed it with my own sources, who tell me Hirschhorn does not have a new job lined up. Here’s Hirschhorn’s version of the announcement, via Twitter:

And here’s a statement from Jon Miller, the News Corp. (NWS) exec tasked with turning around the once-dominant site:

We fully respect Jason’s decision to leave and his personal desire to return to New York. As many people know, Jason is like family to me, and as expected, he’s done everything we asked of him and more. We’re incredibly grateful for the passion and enthusiasm he brought to the company. And as I know Jason agrees, Mike Jones has done an outstanding job leading MySpace into its next evolution and is the right person to take the reins. There are no plans to bring in additional management.

And finally, HIrschhorn’s goodbye note to his staff:

From: “Jason Hirschhorn”
Date: June 17, 2010 5:20:38 PM EDT
To: “FIM MySpace All”
Subject: My Transition

MySpacers,
 
I wanted to share some personal news with you. After much thought I have decided to leave MySpace. It was a hard decision, but is weighted in my desire to move back to New York City.
 
The past 15 months have been the most exciting in my career. The challenge that we have all worked on together, reinventing MySpace, is a dream project.
 
With the roadmap in a solid place, the Futura designs being executed now, and a new leadership firmly in place, I felt this was a good time for me to transition out.
 
I did not take this decision lightly. But given my faith in my partner Mike Jones and his brilliance, coupled with the amazing teams we have in place, I feel as optimistic as ever about MySpace.
 
I cannot thank Rupert, Jon and Owen enough for giving me the opportunity to work at MySpace. It has been a pleasure working with each and every one of you.
 
I will be in the office until the end of the month and available to Jon and Mike during the transition.
 
You are all family. I will miss you.
 
P.S. My mom is pissed I am leaving LA!
 
Best,
 
Jason

Hirschhorn’s departure isn’t a total shock: It’s hard to find an example of any company, anywhere, that has really worked with more than one person in charge.

And Hirschhorn always seemed like an uneasy fit at MySpace, though his mood seemed to improve when former boss Owen Van Natta was moved out earlier this year. I’m told that he’s leaving on much more amicable terms than Van Natta and may end up working with Miller on some other News Corp. digital projects.

Still, despite Hirschhorn and Miller’s sunny description of MySpace, it is very much a troubled, money-losing asset. Former rival Facebook eclipsed it in audience, dollars and mojo long ago. And an ad deal with Google (GOOG), which generated the bulk of its revenue for years, is expiring very soon.

The most charitable description of MySpace would be a “work in progress,” which is the phrase News Corp. COO Chase Carey likes to use, over and over.

The good news for Hirschhorn’s former co-worker Jones: If he can show any positive result at all, the glory will be all his.

Here’s a March interview Kara Swisher conducted with two men, in which they explain that things aren’t as bad as they seem:

]]> http://allthingsd.com/20100617/myspace-co-president-jason-hirschhorn-leaves/feed/ 0 http://allthingsd.com/20100607/veoh-ceo-shaprio-resurfaces-at-myspace-music/ http://allthingsd.com/20100607/veoh-ceo-shaprio-resurfaces-at-myspace-music/#comments Mon, 07 Jun 2010 17:39:56 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=20190 Dmitry Shapiro, last seen mourning the end of Veoh, has a new gig: Today is his first day as chief technology officer at MySpace Music.

It’s not a huge shock to see former start-up CEOs join big companies after the demise of their own. But this move is a bit more surprising: It means Shapiro will be working for one of the companies that helped put him out of work.

That’s because MySpace Music is a joint venture between News Corp. (NWS) and the big music labels, including Universal Music Group. And Shapiro, among others, has pointed to Universal’s copyright-infringement lawsuit against Veoh as one the primary reasons for the video site’s downfall.

But apparently, Shapiro doesn’t mind working for Universal now. In any case, he’ll be reporting to MySpace execs Courtney Holt, Mike Jones and Jason Hirschhorn, not Doug Morris. And you could argue that it makes sense for MySpace Music to have a tech guy on board who has intimate knowledge of the big music labels, warts and all.

Plus, MySpace Music needs help from wherever it can find it. The site still boasts some 30 million unique users. And as other free music sites melt away, it is one of the only places to get legal streams without paying for them. But two years after launch, it’s still a mess to navigate, and I don’t know anyone who uses it on a regular basis. Maybe Shapiro can help.

Veoh, meanwhile, never actually went away. Something called Qlipso purchased the site, which had raised some $70 million, for less than $10 million in March.

]]> http://allthingsd.com/20100607/veoh-ceo-shaprio-resurfaces-at-myspace-music/feed/ 0 http://allthingsd.com/20100218/myspace-to-hold-a-remain-calm-all-is-well-meeting-today-for-staff-heres-five-questions-that-someone-should-ask/ http://allthingsd.com/20100218/myspace-to-hold-a-remain-calm-all-is-well-meeting-today-for-staff-heres-five-questions-that-someone-should-ask/#comments Thu, 18 Feb 2010 13:07:38 +0000 Kara Swisher http://kara.allthingsd.com/?p=24579

MySpace has apparently scheduled an all-hands meeting today, which one source noted is to talk about the new order and to rally the likely much dispirited troops at the struggling social networking site.

With the sudden firing of relatively recently installed CEO Owen Van Natta last week by News Corp. digital head Jon Miller, it will be up to the two new co-presidents he installed, Jason Hirschhorn and Mike Jones, to give MySpace employees a whole lot of reason to believe they can reinvigorate a site that seems woefully resistant to revival so far.

While the one-time trio of Van Natta, Hirschhorn and Jones did manage to stanch the traffic declines in their short and, in hindsight now, rocky, tenure over the last year and have worked to fix the shoddy plumbing, getting the water running regularly is nothing that will inspire anyone internally or externally.

But they do seem to know that, at least.

In any case, if BoomTown were there–and don’t assume I am not skulking around, boys–here are five basic questions I would want the new leaders to answer, including Miller, who is clearly the silent third partner here. (Bonus: I left out Facebook-related questions, as that would be too painful):

While it might be looking backward, exactly why and how was the decision to fire Van Natta made? Was the direction in which he was leading MySpace–related to the socialization of music and other entertainment content–the wrong one? And should those staffers he brought in, such as advertising head Nada Stirratt and many others, be prepping resumes?

What are the three top priorities for MySpace? A massive redesign? A rebranding? Perhaps spinning off as a kind of huge start-up from owner News Corp. (NWS) so it can live or die on its own merits and have more of a chance of attracting talent and encouraging innovation? And, if MySpace stays part of the massive media empire, what are the benefits of that now?

Is MySpace trying to keep its remaining users or bring in new ones? If the former, what will keep them? If the latter, what will get them to try the service (again)?

Do you really believe MySpace can once again be on the growth path it was once on, and can what has clearly become a tired brand be reborn? What are the precedents for such a situation–and you may not use Apple (AAPL) as the example, because there is no Steve Jobs present?

And, perhaps most important: Who’s really in charge?

Of course, that might or might not be a very rhetorical question, to say the least.

Until it is all settled, you can add more questions below in comments. Also, here’s that famous video clip from the movie “Animal House” to enjoy, which is still incredibly funny after all these years:

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

]]> http://allthingsd.com/20100218/myspace-to-hold-a-remain-calm-all-is-well-meeting-today-for-staff-heres-five-questions-that-someone-should-ask/feed/ 0 http://allthingsd.com/20100211/after-even-more-turmoil-can-the-hot-mess-at-myspace-be-saved/ http://allthingsd.com/20100211/after-even-more-turmoil-can-the-hot-mess-at-myspace-be-saved/#comments Thu, 11 Feb 2010 10:33:44 +0000 Kara Swisher http://kara.allthingsd.com/?p=24330

Last week, someone who has been at MySpace for a while told me what it’s like working inside the social networking company, which has gone from supernova to also-ran in the course of a few years.

Reflecting on the downward spiral, which MySpace owner News Corp. (NWS) has been trying to slow over the last year, and how hard it has been to do a turnaround of any kind, the exec could not shake the idea that it could still be revived.

“MySpace is kind of a hot mess,” said the exec, referring to its still-large audience and well-known brand. “It’s both impossible to save and hard to give up on.”

Unfortunately for all those involved, that mess got even messier yesterday after the ousting of CEO Owen Van Natta by News Corp. Chief Digital Officer Jon Miller.

While News Corp. tried to paint the departure as more mutual in its official statement, it was most definitely not, as infighting among top execs finally came to a head today.

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

Escalating tensions over strategy going forward had grown untenable between Miller and Van Natta, as well as among and between Van Natta and his top two execs, COO Mike Jones and Chief Product Officer Jason Hirschhorn.

(Pictured from left to right above are Van Natta, Jones and Hirschhorn.)

Sources said relations had gotten so bad that Hirschhorn had told Van Natta recently that he was planning to resign by June.

It was a threat that moved well beyond well-known gripes the former media exec had aired to many outside the company over the last year about how MySpace was in much worse shape MySpace than he thought, and that reflects weariness from the weekly commute between his home in New York and the company’s Los Angeles HQ.

And after a recent blog post that claimed Hirschhorn was the one leaving, relations became even frostier, sources said.

The relationship between Miller and Van Natta had also become badly frayed, several sources noted, mostly over the pace of change and the level of control Van Natta had over MySpace.

“There were serious disagreements and something had to give,” said one person close to the situation.

After firing Van Natta in an afternoon meeting yesterday in what several people described as a “termination without cause,” Miller (pictured here with Van Natta behind him) appointed Jones and Hirschhorn co-presidents of MySpace.

It was a dramatic shift from only nine months ago.

With the backing of News Corp. CEO Rupert Murdoch, Miller hired Van Natta last April, after jettisoning co-founder and CEO Chris DeWolfe.

But despite his CEO title, the former Facebook and Amazon (AMZN) exec didn’t get to select the two top executives beneath him.

Both Jones and Hirschhorn were hired by Miller directly–also with Murdoch’s involvement and approval.

The idea at the time of assembling this troika was that three heads are better than one, especially in dealing with the technological, administrative and business hairball that MySpace had become over the years.

As it turned out, three heads came with three brains and three different ideas of what MySpace needed to do to fix itself.

While the work to clean up the company, make cuts and attract new talent proceeded, it seems as if not enough progress was made on the what-next part of the equation, as various strategies were considered.

That led to an increasing number of clashes as pressure began to mount to do something, even as rival Facebook’s growth skyrocketed.

While Van Natta and the others distilled the idea of making MySpace the place where consumers and artists store and keep track of their entertainment content online, using a series of “super tools” to move them all over the Web, the lack of concrete changes even began to irk Murdoch.

In News Corp.’s earnings call last week, in fact, Murdoch said about MySpace, despite recent encouraging signs of stabilization: “It’s not yet where we want it.”

Uh-oh, that might have been a clue to watch for big changes!

In addition, as MediaMemo’s Peter Kafka noted, News Corp. disclosed that MySpace and the rest of its digital portfolio were coming up short on their end of a $900 million, three-year search deal with Google (GOOG), meaning that News Corp. would receive around $100 million less than originally anticipated.

This was due to changes made to the site’s design, which cut down on some page views that the old site created to show higher traffic.

And, said sources, any new search deal with Google or, perhaps, Microsoft (MSFT) is not expected to be stellar.

“MySpace will get paid what it is worth,” said the source about search fees. “But the days of big payouts are over.”

The real problem, of course, is that MySpace’s audience has been going elsewhere, particularly Facebook, and will continue to do so until a bold new direction is set.

Many in the industry do not think that is even possible and that News Corp. shouldn’t even own MySpace anymore.

There is also a good argument that the company should have, and could have, sold the asset several years ago, either to Yahoo (YHOO) during its takeover fight with Microsoft or to another bidder when the company was riding high.

Now, News Corp.–which is dealing with many other vexing digital issues, including a pitched battle over paid content–is stuck trying to fix a distressed asset that became that way by allowing the old regime to run it in a less than rigorous manner.

And despite all the Band-Aids applied so far, reviving MySpace will take a lot of more arduous work from Jones and Hirschhorn, neither of whom has helmed as big an organization, despite recent layoffs.

In addition, the co-presidents must get along well, and power-sharing arrangements are always tricky to pull off.

So, until Miller, Jones and Hirschhorn figure it out–or not!–and, in honor of MySpace’s music meme, here is Cobra Starship’s “Hot Mess” video:

]]> http://allthingsd.com/20100211/after-even-more-turmoil-can-the-hot-mess-at-myspace-be-saved/feed/ 4 http://allthingsd.com/20100210/myspace-ceo-van-natta-was-fired-by-news-corp-digital-head-miller-in-late-afternoon-meeting/ http://allthingsd.com/20100210/myspace-ceo-van-natta-was-fired-by-news-corp-digital-head-miller-in-late-afternoon-meeting/#comments Thu, 11 Feb 2010 02:59:08 +0000 Kara Swisher http://kara.allthingsd.com/?p=24314

The long-running telenovela that has been MySpace over the years took yet another dramatic turn late today when News Corp. Chief Digital Officer Jon Miller fired MySpace CEO Owen Van Natta, whom he had hired only nine months ago to turn around the troubled social networking site, according to several sources.

(The pair are pictured above in happier times, with Van Natta on the left, during an interview Walt Mossberg and I did with them at the seventh D: All Things Digital conference in May. You can see the full video below.)

While News Corp. tried to paint the departure as more mutual in its official statement, it was most definitely not, as problems among top execs finally came to a head today.

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

Among the issues were tensions between Miller and Van Natta, as well as growing tensions with his top two execs, COO Mike Jones and Chief Product Officer Jason Hirschhorn.

Miller hired Van Natta, but the CEO didn’t bring in the two executives directly beneath him: Both Jones and Hirschhorn were hired by Miller, along with News Corp. (NWS) CEO Rupert Murdoch, who signed off on both men.

Sources also noted that Van Natta, a former Facebook and Amazon (AMZN) exec, had begun to bridle at not being able to select his own execs and at increasing meddling in the MySpace turnaround by Miller.

“There were three senior thinkers put in place to fix MySpace and it became clear that not all those voices were needed anymore,” said one person close to the situation. “So, Owen was the odd man out.”

And out he went in a flash, with Miller flying to Los Angeles early in the week to deal with rumors that it was Hirschhorn who was on his way out.

In fact, the well-known media exec had been vocally complaining for months about the harder-than-expected struggle to right MySpace’s once innovative business and had told many he was contemplating leaving within the next few months.

Today, several sources said, he conducted an all-day review of the plans Van Natta, Jones and Hirschhorn had been working on to revive MySpace and morph it into an entertainment and music hub.

After it was over, multiple sources said, Miller met with Van Natta and told him his tenure at CEO was over.

The move came as a shock to the staff at MySpace, as it was not expected, although it was clear that top execs at News Corp. were aware of the decision made by Miller.

“Simply put, it was a power struggle and Jon won,” said one source.

Miller has not returned my emails or phone calls about the situation, and a News Corp. spokeswoman declined to comment.

Ironically, after fixing a range of technical and product issues over the last several months, MySpace was beginning to see stabilization in the bleeding of users.

Comparatively, rival Facebook has seen explosive growth, reaching 400 million global users this week.

More details to come, but here is the D7 interview with Miller and Van Natta:

]]> http://allthingsd.com/20100210/myspace-ceo-van-natta-was-fired-by-news-corp-digital-head-miller-in-late-afternoon-meeting/feed/ 10 http://allthingsd.com/20100210/that-was-fast-owen-van-natta-out-at-myspace/ http://allthingsd.com/20100210/that-was-fast-owen-van-natta-out-at-myspace/#comments Thu, 11 Feb 2010 01:45:12 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=16178

Owen Van Natta, the prominent Internet executive brought in to overhaul MySpace, has left after less than a year.

News Corp. (NWS), which owns the social network, has replaced the CEO with his former lieutenants, Mike Jones and Jason Hirschhorn, who have been named co-presidents.

It is Van Natta’s second consecutive short-tenured job. Prior to MySpace, he ran music start-up Project Playlist, where he stayed for less than six months. Van Natta built his reputation at Facebook and Amazon (AMZN).

A  press release spins this as a mutual decision between Van Natta and Jon Miller, the News Corp. executive who joined the company less than a year ago himself to run digital operations. But that’s going to be a difficult story to sell.

For starters, it’s clear that attempts to turn the social network around are taking much longer than expected, as News Corp. CEO Rupert Murdoch acknowledged last week during the company’s earnings call.

Last fall, News Corp. disclosed that MySpace and the rest of the company’s digital portfolio were coming up short on their end of a $900 million, three-year search deal with Google (GOOG), which meant News Corp. would receive around $100 million less than originally anticipated.

That may be in part because of changes the new MySpace leadership made to the site’s design, which cut down on some of the page views the old site created. But the shortfall was primarily because the MySpace audience has been migrating to other sites, particularly Facebook, for some time.

MySpace executives have been overhauling the site, mainly under the hood, and rolling out a series of incremental changes in recent weeks. These changes aren’t supposed to win back Facebook users–the company has declared that it’s no longer trying to compete with that site as a social network anymore–but are designed to help it hang on to existing users and establish itself as some sort of entertainment hub.

A tough task under any circumstance. But tensions in the corporate suite didn’t make it easier. Miller hired Van Natta, but the CEO didn’t bring in the two executives directly beneath him; both Jones and Hirschhorn were hired by Miller (along with Murdoch, who signed off on both men).

People who have talked to Van Natta say he has been relatively public about his frustrations at the job in recent weeks. Describing Jones and Hirschhorn as happy campers would be a stretch, too.

But whatever finally prompted the move seems to have come relatively quickly: The MySpace and News Corp. insiders I’ve talked to so far seem taken aback by Van Natta’s departure.

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

Here is the official press release from News Corp.:

Owen Van Natta Steps Down as MySpace CEO; ?Mike Jones and Jason Hirschhorn Elevated to Co-Presidents

Los Angeles, CA, February 10, 2010–News Corporation today announced that Owen Van Natta will step down from his position as MySpace CEO, effective immediately. Mr. Van Natta will be replaced by newly-elevated co-Presidents Mike Jones and Jason Hirschhorn, who will each report to Jon Miller, Chairman and CEO of Digital Media for News Corporation.  All three executives joined MySpace in April 2009, with Mr. Jones and Mr. Hirschhorn previously serving as Chief Operating Officer and Chief Product Officer, respectively.

“Owen took on an incredible challenge in working to refocus and revitalize MySpace, and the business has shown very positive signs recently as a result of his dedicated work,” said Jon Miller, News Corporation’s Chairman and CEO of Digital Media. “However, in talking to Owen about his priorities both personally and professionally going forward, we both agreed that it was best for him to step down at this time. I want to thank Owen for all of his efforts.”

Mr. Miller continued, “Mike and Jason have demonstrated true leadership in their operational and product guidance, respectively, and I have the utmost confidence in both of them to lead MySpace into its next chapter.”

In a joint statement, Mr. Jones and Mr. Hirschhorn noted:

“We joined MySpace last April with very a specific set of goals in mind, and are anxious to continue working together to make those goals a reality. This business is now pointed in the right direction, and we have a great team of employees that will continue to push MySpace closer to its potential as the place where people go to be discovered and to discover great content.”

Mr. Van Natta commented:

“MySpace is an incredibly unique place and we’ve made real gains in terms of product focus and user experience.  I’m proud of the work we’ve all accomplished together and look forward to watching its continued growth.”

Prior to his role as MySpace COO, Mr. Jones founded and operated several online businesses, including Userplane, a leading provider of tools for online communities such as MySpace. Userplane was acquired in 2006 by AOL, where Jones subsequently served as a senior vice president and focused on social media monetization and also pioneered the distribution of widgets and other technology to Web publishers. He also was founder and CEO of Tsavo Media, an online content and search network developing next-generation publishing platforms and technology services.

Since joining MySpace, Mr. Hirschhorn oversaw all aspects of product development, and previously has led both start-up and established online businesses. He was president of Sling Media, Inc.’s Entertainment Group, which created consumer-driven applications and services for the Slingbox device, and was chief digital officer at MTV Networks, where he oversaw the company’s digital media businesses, products and strategies. Hirschhorn joined MTV Networks following the acquisition of his company, Mischief New Media, which provided interactive services to the entertainment industry.

]]> http://allthingsd.com/20100210/that-was-fast-owen-van-natta-out-at-myspace/feed/ 0 http://allthingsd.com/20090819/myspace-finishes-its-acqhire-of-ilike-dont-think-music-think-socialization-of-content-plus-the-internal-memo/ http://allthingsd.com/20090819/myspace-finishes-its-acqhire-of-ilike-dont-think-music-think-socialization-of-content-plus-the-internal-memo/#comments Wed, 19 Aug 2009 20:19:33 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=10061

Now that MySpace has finished its acquisition of iLike, what it’s going to do with it? Don’t think music, MySpace CEO Owen Van Natta stressed in a press conference today, think about “socialization of content.”

What does that mean? Pretty vague, which, I gather, is Van Natta’s intention.

But in short, what Van Natta is saying is that he has bought a 26-person company–for $19.5 million–because it has engineering talent that is good at building stuff that 1) helps users find content and share it with one other, and that 2) works on multiple platforms.

Van Natta did make a point of downplaying iLike’s ability to help MySpace build out its music offering, though. Which makes sense, because MySpace already has a music platform that it owns in a separate joint venture with the big music labels.

And because while iLike is known as a music platform, it really isn’t. It doesn’t have deals with the music labels that let users listen to full songs, and it only recently launched a way for users to buy songs. What it does do is recommend music based on stuff you like, and lets you share your likes and recommendations with friends.

You can see how the people who built the iLike platform–primarily on the back of Facebook, where Van Natta was formerly COO–could be useful for MySpace, which is in the midst of a drastic overhaul.

Van Natta was brought in to run the once-hot social network at the behest of corporate owner News Corp. (NWS) earlier this year, and has been busily hiring and firing since then.

The iLike deal is Van Natta’s first major acquisition since he came on, but it is essentially a hiring move, too. The plan is to keep all of the company’s key talent, including CEO Ali Partovi, President Hadi Partovi and CTO Nat Brown. (All three are in the picture at the top of this post, along with Van Natta and MySpace COO Mike Jones. From left to right: Ali Partovi, Jones, Van Natta, Brown and Hadi Partovi.)

Speaking of that talent: Asked about All Things Digital’s report about tax issues slowing the last stages of deal, Van Natta declared that “this was actually one of the smoother sailing deals that I’ve been involved in.”

Which may be true, but it doesn’t mean there weren’t tax problems for the company he was acquiring, as well as a delay.

In one email to the entire iLike board on Monday afternoon, titled “late-breaking tax issues with iLike/MySpace merger,” Co-founder Hadi Partovi wrote, referring to his brother and also Co-founder Ali:

“Ali & I recently learned about a potential tax liability that could be significantly disadvantageous to us as a result of the merger.

“We don’t have definitive info yet, and we’re just as disappointed as anybody to learn this at the 11th hour.”

Then, Hadi Partovi sent yet another email to Gregg Winiarski, GC at IAC (IACI) yesterday, titled “potentially significant tax risks for iLike common shareholder (esp Partovis).”

Before IAC had spun off Ticketmaster Entertainment (TKTM) last year, which was one of iLike’s big investors, Winiarski had apparently been involved in some iLike issues around compensation.

So Hadi asked him: “gregg, do you have any thoughts on this? since the structure of moving into common-stock (to avoid income tax) was your idea, I was hoping you [would weigh in].”

Winiarski–in several exchanges, in which Hadi’s brother and also Co-founder Ali Partovi even asked if IAC and Ticketmaster might indemnify them if problems arose–politely declined to weigh in, presumably since IAC was no longer an investor in iLike.

Ali Partovi intently asked for a call “TODAY,” but Winiarski did not bite on that or the indemnification request.

In the end, Ali Partovi wrote: “We’re moving forward with the deal, mainly because Hadi and I are not the types to hold up a deal over this. But I’d appreciate if you’d be open to a discussion about the risk exposure we’re sustaining here.”

Apparently it did not hold up the deal.

Maybe someone can ask Van Natta about that in the all-company meeting MySpace has scheduled for next week, which he mentions in this internal memo announcing the deal:

Hi everyone,

I’m pleased to announce this morning that MySpace has entered into an agreement to acquire iLike.

iLike is a social music discovery service that in just two years has become the largest, most comprehensive music application across all social networks. With 55 million users and 1.5 billion monthly impressions, their growth speaks directly to the usability of the product, the technology behind it, and the great team that built it.

One of the great things about MySpace is that its openness enables discovery–we’re going to take that strategy one step forward by also allowing users to experience content on the distributed Web.

On MySpace, users connect with the content they love in a centralized and social environment. On iLike, users can access the content they love in a highly distributed environment across their favorite websites. This shared vision around content distribution is a key component to the future of MySpace.

What the iLike team has done with music is applicable to all of the areas that are important to MySpace users today such as entertainment, video, and games. Because we view the opportunities of this acquisition beyond the music category, MySpace Inc. will be making this acquisition separate and apart from the MySpace Music joint venture.

The company’s current management–CEO Ali Partovi, President Hadi Partovi, and CTO Nat Brown–will continue to lead iLike’s future. I’ve known Hadi and Ali for almost 10 years and the two of them, along with Nat are talented entrepreneurs with a strong track record for building world class product.

Just to give you a sense of their history and professional achievements:

· Ali established himself as an entrepreneur by co-founding LinkExchange, which started as the web’s first and largest banner-advertising network and grew to become the web’s largest small-business portal before being acquired by Microsoft in 1998. In 2002, Ali became CEO of Garageband.com and then iLike.

· Hadi co-founded Tellme Networks, a leading provider of voice/telephone technology and services, where he ran product and technology, and later spearheaded the company’s shift from consumer services to enterprise call-center automation for AT&T, FedEx, and E*TRADE. Tellme Networks was acquired by Microsoft in 2007. Both acquisitions (LinkExchange and TellMe) rank as two of Microsoft’s biggest deals to date. Hadi was also an original group program manager for Internet Explorer, a general manager of MSN.com, and he incubated Start.com (now Live.com).

· Nat has a deep and respected history as an early architect at Microsoft. He rapidly earned a reputation as one of Microsoft’s foremost technical minds by creating and evangelizing the ActiveX/COM object model in the early 90s. He went on to play a seminal role in the creation of XML, DHTML, and as a primary architect of the first XBox. After retiring from Microsoft, he served briefly as CTO at CAC Media and has informally advised numerous startups.

In addition to this great management team, iLike has 26 employees in various technical and business functions including a market leading development team that will join MySpace. iLike will remain headquartered in Seattle but our teams will be working very closely. I’m excited to see the great things that come out of the collaboration between our management teams, employees, and cultures.

We have an all-company meeting next week and I look forward to seeing everyone and answering any questions you might have.

Please join me in welcoming Ali, Hadi, Nat and everyone at iLike to MySpace.

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