MySpace to Ax Up to Half Its Workers

Downsizing could be announced this month, sources say
By Evann Gastaldo,  Newser Staff
Posted Jan 4, 2011 7:31 AM CST
MySpace to Ax Up to Half Its Workers
Demo of a MySpace webpage using OpenSocial, a programming model developed by Google   (Graphic: Business Wire)

Another blow for struggling MySpace: The social networking site is planning massive layoffs, and could ax between a third and a half of its employees, sources tell the Wall Street Journal. The News Corp-owned company, which employs about 1,100, is expected to announce the reductions this month. Its staff was already downsized by almost 30% over the summer, but more layoffs are needed to control costs, says an insider.

The dramatic restructuring is the latest move as MySpace attempts a makeover, positioning itself as more of a music, games, and entertainment hub. The site was recently redesigned, and a new ad deal was struck with Google—though that deal is said to be less profitable than an earlier one. Meanwhile, visitors continue to decline, down 15% in November from the prior year. Facebook, on the other hand, just snagged a $500 million investment
(Read more MySpace stories.)

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