News Corp.'s Jon Miller: MySpace stopped innovating

MySpace stopped innovating at a time when it led the social networking market and had strong momentum, leaving the door open for competitors such as Facebook and Twitter, said Jonathan Miller, who oversees News Corp.'s Internet businesses, including the embattled MySpace.

"The thing you see in this space more than anything else is that if you don't keep innovating and moving forward, you get in trouble. You can't stop," Miller said Thursday at the Web 2.0 Summit in San Francisco. "And MySpace stopped."

Miller was hired by News Corp. in April to be chairman and CEO of its Digital Media Group, as well the company's chief digital officer, at a time when Facebook had already stolen MySpace's thunder, speeding past it to become the world's largest social networking site.

"Everybody in the company is upset that we didn't keep going when we had the real momentum. Regaining momentum is always much harder than keeping momentum going," Miller told conference chair John Battelle, who interviewed him on stage.

Since his appointment, Miller has shaken things up, bringing in former Facebook executive Owen Van Natta to replace MySpace's CEO Chris DeWolfe and overseeing deep staff reductions at MySpace in the U.S. and abroad.

Miller and Van Natta have been trying to refocus MySpace on its historical strength of music and entertainment, a strategy that led to the recent acquisition of online music company iLike.

In addition to recapturing its original essence and streamlining its business operations, MySpace must be innovative, Miller said. What it must not do is go back and attempt to "fix" the strategy that led it astray.

"Fix implies something was broken and you just put it back together the way it was and [consider] it's fixed. That's the wrong way to think about it. You have to think ahead," Miller said.

An example of the strategy to turn MySpace's fortunes around is this week's announcement of new music and video offerings, he said. MySpace announced a new MySpace music video service, music artist dashboard, iTunes integration and iLike integrations.

"We're going back to basics in that sense, but you have to make it relevant to today and going forward," said Miller, a former AOL CEO.

When asked whether News Corp. will look to acquire Internet companies, Miller said it would only consider buying those that could complement the MySpace strategy in areas such as games, music and entertainment in general. At this point, News Corp. wouldn't be interested in acquiring companies just because they have "cool" technology, he said.

Miller said he is "obsessed" with real-time technology, such as the one Twitter has exploited in its social networking and microblogging service, and he wants to see MySpace incorporate it.

He also said MySpace is lagging by having a platform that has been "too closed" to external developers, something that he wants to see changed, especially for the sake of MySpace's gaming offerings. In addition, he wants to see MySpace push ahead in mobile.

Miller declined to comment on recent reports that he's shopping around the Photobucket photo and video sharing service that News Corp. acquired in 2007, saying only that the company is evaluating its Internet assets to make sure they all fit into its overall strategy.

Miller also said the future of Internet publishing has to include a paid component to complement ad-supported free content. He used The Wall Street Journal, which is also a News Corp. business, as an example of a successful melding of paid and free content. The key is for the paid and free content to be clearly differentiated so people see clearly the premium features that paid options offer, he said.

Copyright © 2009 IDG Communications, Inc.

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