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Is Myspace at Death's Door? And Can Anybody Resuscitate It?

In hindsight, it was kind of nice that News Corp. (NWS) gave Myspace a week to bask in the sun of its new redesign before letting the world know that the patient was, in fact, terminal. The new Myspace (which drops the cap "s") is being engineered as a social entertainment site, at least a year after it was obvious to anyone paying attention that if it were to have a renewed life, that should be the focus.

But then came News' fiscal Q1 earnings call yesterday, in which president/COO Chase Carey (Rupert Murdoch was not on the call) stated Myspace's situation plainly. After briefly outlining changes in the site's focus and cost structure, he said:

... we recognize the critical issue is building interest with consumers. We also recognize the challenges we face in doing so. The current losses are not acceptable or sustainable. Our current management did not create these losses, but they know we have to address them. I give them great credit for pouring their hearts and sweat into creating a great, new Myspace experience that has the potential to be an exciting business for us. We equally know we need to make real headway in the coming quarters to get this business to a sustainable level.

The down and dirty is that the site is down $70 million from where it was a year ago, and the News unit it's contained in -- the amorphous "Other" -- had an operating loss of $156 million, a hole that is $36 million deeper than it was a year ago. Its performance, or lack thereof, stands out, especially given that overall, News' profit was up 36 percent for the quarter.

With that as context, it shouldn't be surprising that later on in the earnings call, when an analyst pressed Carey further about Myspace's situation, he said: "This is something we judge in quarters, not in years."

Like, wow. Of course, the mind starts spinning with scenarios of how Myspace might be saved. Would someone buy it? The usual social media suspects, like Facebook and Twitter, have no reason to. Would the music-themed Myspace be a good fit for Apple? Of course not -- at least from Apple's perspective. For one, Apple has its own social network tied to iTunes -- Ping -- and second, could you really see Steve Jobs buying a dying no-longer-cool Web property? Not on your life.

What about music subscription services like Rhapsody? Might be a fit -- at the right price. Aol is said to be on the acquisition trail, but after the disaster that was Bebo -- which it later sold for a fraction of what it paid to buy it -- it would never consider it.

Unfortunately, I think the best way for News to generate interest, and traffic, to Myspace again would be to hold onto it -- and make it the exclusive portal for News entertainment content: movies, music, TV shows like American Idol. But as it is for so many of the potential suitors above, News would never do such a thing. It's a part owner of Hulu, among other complications, and it's certainly clear that the company would never sacrifice successful content to raise the fortunes of Myspace.

Unless I'm missing something, I don't see where Myspace goes from here.