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MySpace Axing Employees: Will That Help?

Posted by Vaibhav Kalamdani on June 18, 2009

myspace layoffNews about MySpace pruning a third of its workforce has spread like fire over the Web. The News Corp. owned social networking site is handing over pink slips to 400 people in a bid to restructure the company and revive innovation. The growing competition from Facebook and other rivals clearly seems to be getting on MySpace – the once leading social networking site in US – now dethroned by Mark Zuckerberg’s Facebook.

MySpace realized that its staffing levels were bloated, which hindered its ability to be an efficient and nimble team-oriented firm, according to MySpace CEO Owen Van Natta. The company is aiming at returning to an environment of innovation that is centered on its user and product.

While dipping ad revenues and members are worrying MySpace at the moment, one cannot take away the credit from Facebook for racing ahead of it in such a short span of time. No doubt MySpace did exceptionally well in the US, however it failed to attract the overseas audience like Facebook.

News Corp.’s CEO of digital media and chief digital officer Jonathan Miller is confident in MySpace’s next phase under Owen’s leadership and his team. He believes that the restructuring will help the company operate much effectively both structurally and financially moving forward.

But the million dollar question still lingers – Will MySpace regain its lost position in the market after axing employees? Nothing can be said at the moment. All that we can do is just wait and watch!

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