MySpace has starting laying people off, we’ve heard from a source close to the company. The final tally may be 5% or more of total staff, with engineering, sales and customer service taking the biggest hits.
MySpace parent company Fox Interactive Media recently missed their revenue target for the last fiscal year and fired their chief revenue officer Michael Barrett. The layoffs may be tied to that missed target.
On the other hand MySpace has undergone massive headcount growth over the last two years, sometimes adding as many as 100 employees per month. Two years ago MySpace had 300 employees; today it is rumored to have 1,500. This may be simply an exercise in pruning.
We’ve contacted MySpace for comment.
Update: I spoke with Amit Kapur, MySpace’s Chief Operating Officer, about the rumors shortly after writing the post. Kapur confirms that they are letting people go, but clarifies it’s entirely performance driven, not layoffs. He would not state the number of people who will be let go, but said it was “less than 5%” and that it is part of their standard yearly performance reviews.
“All of the employees we are letting go will be replaced,” he said, and “we are also rewarding top performers.” “This is an important way to drive a streamlined business,” he added. Kapur is also highlighting the upgrades being made to the MySpace management team. MySpace is continuing to hire aggressively, and plans to add up to 300 people in the coming months, he said. He also pointed out that MySpace is moving into new offices, with plenty of room to grow.
Very Sad….
Hope it is not the Start of Web 2.0 Lay offs ..
Cheers, Nag
What a sad news you got there about MySpace. So sad.
Is its competition between Facebook also involved in this matter?
Customer Service – they actually have a customer service? We’ve known people to have sent messages to Myspace only for them to get lost somewhere in the Myspace abyss..never to be replied to. We’re surprised they actually have a department for that based on what we’ve heard..hmm maybe the employees were too busy Myspacing all day instead of doing their jobs
You are ignorant.
Bet on pruning. You can’t grow that quickly under a 13-year-old CEO and not accumulate a lot of dead wood (Nick’s CS employees?).
Anyone else having problems with site availability over the last week or so?
Too bad MySpace.
1500 employess to run myspace wtf
you got plentyoffish guy running a site by himself
well, they dont have great applications like facebooks police app…….
someone should ticket people who are on my space….
Yippie! To hell with MySpace, their censorship, the placing of unwanted software on my computer and just the general rudeness and behavior of their staff and members. If they were to belly up tomorrow I will be dancing in the street. I my self am a member at sitespaces.net where none of MySpaces controlling behavior happens.
Yeah, but you got the control-freak “beer co. Chris” who will sell you out to the highest bidder at a moment’s notice. As he taunts his power over his list of members here all the time. Good luck with that 10th rate “socnet”.
When a fast growing technology company gets purchased by a large corporation it is common to get fat quick. An employee at startups or early stage companies usually have several roles, but traditional companies are used to matrices of marketing, customer service, content, accounting, etc. This makes a companies overhead and headcount shoot up and GP drop. This happened with the last technology company I worked for.
My guess is they are just trimming the fat and figuring out what they really need and what positions grow revenue vs. cost.
They are very bloated. Watch out below! The crash may be upon us! If true Techcrunch will get wiped out, too!
signs of credit crunch, it will get a lot worse I’m sure.
I’ve got inside sources that claim this 5% lay off to be false. Just letting you know.
I will wait for the official reply for that one…
That’s an enormous amount of growth in hope of accelerating the traffic and revenue post acquisition now that there is a large company and a large amount of cash behind the scenes. The acceleration has slowed so it’s time to prune.
getting rid of the 5% lowest performers and then re-hiring in better candidates is a great idea, I support it. i wish previous companies i worked at did this
The real problem is the 5% aren’t really
lowest performers but victims of those
rude, uncapable managers who thinks they
deseve servant-like employees. Though they
are just underdogs who sacrifice the company
and employees for their own enjoyment and status vanity…
Propaganda. Ship is going down and smartest people are jumping off now.
The economy seems to be effecting everyone at this point. http://blabtech.blogspot.com
I hope they laid off the CAPTCHA guy?
That would user experience, page views and time on site – you know produce some revenue.
Everyone considering layoffs, should lay off the CAPTCHAs first…
That would *improve* (ooops)
I love the rumor mills on this comment chain…everyone has an ‘insider’ source…and much of it is not accurate.
Has anyone commenting actually read the addendum that there aren’t layoffs happening? Myspace just had annual reviews last month, it’s a good sign that some people are getting bounced.
Actually they laid off a ton of people yesterday and had HR escort the people right out. Classy.
There were more Today
yikes!!
I love how people who don’t know much about MySpace and online business in general like to pretend they understand how a company like MySpace works.
First of all, MySpace generates millions of dollars in revenue based on advertisers. There are still many advertisers out there that understand that MySpace generates a high volume of traffic. For those of you who ditched marketing 101 or slept-in because you were online all-night, companies pay top-dollar for advertiser space on sites like MySpace.
So uh no, MySpace isn’t hurting for money even if it missed it’s gazillion-dollar unrealistic goal. Trust me, those sales people are making BANK.
And as for those people who were laid-off. All of the top-quality people are still at MySpace. And there are some top-performers who did leave to go on to better opportunities. I would consider them stupid to stay at MySpace considering some people in MySpace (people who work on teams that directly support revenue clients) are not treated well at all and are not paid well AT ALL – even to this day. I expect more to jump ship because of this treatment. Which is sad because these people are very loyal and want to stay.
“All of the top-quality people are still
at MySpace”
- How can you be sure all top quality are
there. There are smart people prohibited
to work on tasks so they don’t look like top
quality. The so called top quality people are
just those who are lucky to get tasks from
the self centered managers.
The data warehouse manager at myspace is
well known for doing this to the employees.
Trust me, because this manager has laid off
too many employees underneath that everyone
would wonder why her employees are not
performing well, maybe the captain is not good
at her job so she develop “under performers”…
“it’s entirely performance driven, not layoffs”
What a blatant lie! I know first hand some of the people that got canned and they were NOT underperformers.
This is a final slap on the face of people who have worked hard for this company and instead of being thanked are being insulted.
“I know first hand some of the people that got canned and they were NOT underperformers”
- Absolutely! The executives thought it is performance driven, but the underdog
managers are doing things underneath very shady.
e.g. a data warehouse manager is notorious for not assigning tasks to employees and tried to fail them this way!
Aw that’s bad. I just hope that myspace will be ad free. and I hope myspace will hire a new workers that can think a better way to improve myspace just like facebook
It’s because myspace sucks and everyones on twitter and facebook now. Plain and simple