THE SOCIAL NETWORKING BUBBLE IS BURSTING: MySpace sold for 1/16th of what is was last purchased for

News Corporation Sells MySpace for $35 Million

MySpace, the long-suffering Web site that the News Corporation bought six years ago for $580 million, was sold on Wednesday to the advertising targeting firm Specific Media for roughly $35 million.

The News Corporation, which is controlled by Rupert Murdoch, had been trying since last winter to rid itself of the unprofitable site. In preparation for the change in ownership, many of MySpace’s roughly 400 employees were dismissed on Wednesday. Mike Jones, the Web site’s chief executive, said in an internal memorandum that he would depart in the next two months.

The sale closes a complex chapter in the history of the Internet and of the News Corporation, which was widely envied by other media companies when it bagged MySpace in 2005. At that time MySpace was the world’s fastest-growing social network, with 20 million unique visitors each month in the United States. That figure soon soared to 70 million, but the network could not keep pace with Facebook, which overtook MySpace two years ago.

This is just the beginning of a re-evaluation of ALL social networking sites.

I feel they are ALL over-valued and that the bubble will soon burst.