Who wants to turn MySpace into a little $10mil niche product? Certainly not Murdoch. And anyone with that ambition probably would rather start from scratch that associate themselves with a failed brand. It's all psychological.
As a competitor to Facebook, they're sinking. But if social networking in this capacity turns, taking their medicine now for poor-sighted assumptions could make a so-so company poised to look smart in hindsight, should they right the ship.
I agree, there are major disadvantages to having this kind of link to old industry money too(being slow, hackneyed CEO culture, etc.) But, Murdoch is wily and buys talent.
I wouldn't bet against them; if for nothing else, their vehement protection of pride.
Eh, Myspace was an eyeballs acquisition, not a talent acquisition. Myspace's lack of a proper engineering culture contributed to its fall from grace; Facebook's faster load times, quicker feature additions, and app platform play all stem from a better engineering culture, and helped it overtake Myspace.
That's actually one of Myspace's biggest problems: they have a history of shoddy engineering and architecture, so they can't attract top talent.