Myspace Should Create Their Own Space

Tuesday, January 30, 2007 3:48

A lot has been written lately on Myspace’s impending China entry. CNN, Marketwatch, WSJ, and dozens of others have covered the story.

Marketwatch calls it “Typhoon Myspace Approaching China”

With 137 million internet users, China is a market that is so important to Rupert Murdoch that he sent his wife to size up and to lay the ground work out(I wonder what her per diem was).

The deal is rumored to be backed by IDG’s Accelerated Growth fund and it appears that News Corp will take a minority share of Myspace China as part of a joint venture.

and while no joint venture has yet to be announced, the name Luo Chuan comes up in every article as the front runner… actually rather than sounding like there are 3 horses in the race still, it sounds more like News Corp is testing the market to see if there is an investor riot.

Throughout each article there are warning signs that show News Corp may be taking the path of least resistance now, but that long term they may regret the day they chose to JV rather than go solo.

From the WSJ

“The management team will need to have control over this venture in order to make sure that it will comply with the regulations [and] to ensure that we will have the power to customize and optimize the services to the Chinese audience,” says Mr. Luo.

In practice, that means News Corp. Chairman Rupert Murdoch might have to take a back seat on how MySpace is run in China.

Need to take a back seat? Has Rupert read Mr. China?

From CNN

Murdoch’s wife, Wendi Deng, who is also a chief negotiator in the deal, is expected to sit on board of MySpace China where News Corp. aims to take at least one board seat, one source said.

Aims to take at least one board seat? so.. in addition to being bring in a minority position which really means having little control, News Corp may have no oversight?
Myspace could be a great fit here. Give 137 million internet users (many under 30) the ability to build a site filled with their pictures, music, and dreams… and you have an instant hit.

But why give up control to gain access?

What happens if Myspace China becomes bigger than Myspace rest of the world? Who would hold power then and drive content?

Since all of this is rumor and speculation, we will all have to wait and see what the details really are, but I hope someone send Rupert a copy of Mr. China in the meantime. I would hate to see News Corp end up in our Fwoked section.

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