MySpace tried to buy Spotify but streaming company "sure as hell" wouldn't sell to them

From over 100-million users to a relic in the tech graveyard, former MySpace online marketing vice-president revealed to a conference in Oslo what went wrong with one of the pioneers of social networking.

Sean Percival worked for the company between 2009 and 2011, just as the site was dethroned in a big way by Facebook, which now has nearly 1.4-billion unique users.

He also revealed that they tried to buy Spotify, the online music streaming site, but by the time Percival came to the company, the brand had lost its sheen and was “unsaveable”, the Guardian reported.

“They sure as hell were not going to sell to us. They didn’t need to”, he said.

But as the crown was slipping, they knew the end was near, Percival told the By:Larm conference, in a talk aimed at startups to stop them making the same mistakes.

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Spotify has over 15 million paying subscribers worldwide

Percival described the site, backed by News Corp, as “such a massive spaghetti-ball mess”, as he talked about what went wrong, citing “bloat” as one of the main reasons for their decline

“More money. More money pouring out. The total of money lost? I don’t even know, but it is in the billions of dollars. Thankfully News Corp has a few billion dollars and they could afford it,” he said, before recalling the “mess” that the original MySpace became in its later years.

“You could do these tree flowcharts of your website … and we did it, and it was like the fricking seven scrolls that you could see. It just went on forever and ever and ever… We were not nimble in any way, shape or form.”

He claimed that corporate values crept into what made its name as a fashionable start-up after it was bought by Newcorp.

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Facebook has nearly 1.4-billion users

“And think about Facebook, the ultimate winner here. No focus on monetisation early on. Very few ads. And when they do ads, they actually do very nice ads. They do more native, more inline advertising, things that feel a little more natural.”

It’s this battle between business and prestige that’s depicted in the movie The Social Network, in which Mark Zuckerberg – played by Jesse Eisenberg – fights business partner Eduardo Saverin – Andrew Garfield – on how early to take advantage of the financial benefits of such a following. But Percival said modern-day businesses have learnt their lesson from the MySpace-News Corp partnership, with the success of Facebook’s acquisition of Instagram and WhatsApp.

“News Corp is a monster organisation, just mammoth proportions: many many billions of dollars, many many users. At the time I remember they said: ‘Hey! We’re not going to disrupt anything. We’re going to let it run: you’re special!’ And just preserve that and not do anything,” he said.

 

“The reality was that as time went on, the corporate policies creeped in. The lawyers came in, the accountants. Everything came in. As opposed to being this nimble, fast-moving sports car, they started to become slow,” said Percival.

“That was always the big challenge for me. I’d want to do something very very basic, and it’s like ‘okay, well, let’s go through the legal process’. We had 40 to 50 lawyers on staff, and we were spending $800,000 a month on external lawyers too.

“We’re getting attacked from all sides. The Department of Justice is coming after us because there’s really bad stuff happening. There’s paedophiles! Weird stuff going on on MySpace. So we’re trying to fight this, and we’re just getting attacked from all angles.”

He also recalls desperate attempts to monetise the business and diversify - MySpace Books was launched - when they should have become more streamlined and concentrated on music.

“So we’d lost the social war, in a sense, but we really should have just gone all-in on music. At the time MySpace had a very, very unique deal with labels. They were the only site on the web that you could go and play any song from a major label for free."

“You can do that on Spotify now … but that was so unique. It was a very special deal: we paid about $10m a year to get that deal, just to have the deal, and then we paid for all of the usage as well. That was something we had that nobody else had. We brokered that deal early on with the labels, and nobody else could get even close. We should have gone all-in on music and cut ship on everything else.”

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