The two founders of social networking site MySpace have been forced out of their positions by parent company News Corp, as the site continues to lose ground to Facebook.
News Corp chief digital officer Jonathan Miller said in a statement that by mutual agreement, co-founder and chief executive Chris DeWolfe will not renew his contract with the organisation.
Miller also said that he is in discussions with president Tom Anderson that will see him “assuming a new role in the organisation”.
DeWolfe will remain inside the company as a strategic adviser and serve on the board of MySpace China.
“In a little under six years we’ve grown MySpace from a small operation with seven people to a very profitable business with over 1600 employees,” DeWolfe said in a statement.
Anderson said he is looking forward to the “next chapter” of MySpace’s journey.
“From the very beginning, our driving passion has been simple – to create and foster a platform where people across the globe can not only meet and interact, but share music, videos, thoughts and ideas,” Anderson said.
DeWolfe and Anderson are credited with creating the social networking giant, which until recently was the largest of its kind until overtaken by Facebook. The site was launched in 2003, and bought by News Corp in 2005 for $US580 million.
Rumours began circulating earlier this year that Anderson and DeWolfe would leave their positions after rival Facebook began gaining users at a faster pace. Facebook now has 200 million users, while a recent survey showed that MySpace lost 400,000 users between 2007 and 2008 and has a total of only 130 million worldwide.
Technology blog TechCrunch first announced the rumour, with blogger Michael Arrington claiming that there was dissention within the company directed at the two founders.
“There are people at News Corp gunning to knock DeWolfe out of the company. The question is whether Murdoch and Miller will protect him,” he wrote.
“And, of course, there is always the chance that DeWolfe will simply leave the company. Its high growth days are likely behind it, a new type of manager may be better suited to running the company going forward.”
Miller also said that a new management structure will be announced soon.
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Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
