Social media site's "space" invaded

MySpace has suffered in terms of web traffic recently because other companies stole in ahead of the organisation, asserted an industry insider.

Social media site MySpace found a niche in the online market, but other firms were able to exploit it, according to an online expert.

Founder of content networking site Dadooda.com Neil Stapley claimed that this does not necessarily mean NewsCorp are likely to sell the social networking website.

He pointed out that the media giant paid a large sum of money for MySpace and other Web 2.0 entrepreneurs then saw a good opportunity.

Mr Stapley highlighted the deal that the social media service struck with Google - with $900 million (£538 million) promised to MySpace if it could keep web traffic up - as an example of why other investors saw the potential in such websites.

"I suspect the effects of new competitors entering MySpace's space, so to speak, may have been underestimated. MySpace found the space - others moved in to it," he explained.

Recently, NewsCorp announced disappointing user figures, with Google's huge payment no longer guaranteed.

11/11/2009