News Corp to give up 50% stake in MySpace China

by Staff, Brand Republic 26-Jan-07, 08:45

HONG KONG - News Corporation will only own half of its social network venture MySpace.com when it launches in China.

News Corp is close to finalising a deal with partners to launch MySpace in China within a few months

According to venture capital and Chinese government sources quoted by Reuters, News Corp is currently applying to the Chinese authorities for an internet services license and expects to set up the joint venture in Beijing.

A stake in MySpace China would be owned by the IDG-Accel China Growth Fund, managed by venture firm International Data Group Technology Venture Investment. Former chief executive of China Netcom Group, Edward Tian, was reported last year also to be involved in the group with Wendi Deng, wife of News Corp chairman and CEO Rupert Murdoch. Deng is likely to join the board of MySpace China.

There is no news on how much News Corp will invest or how much the launch will cost overall. However, a potential CEO for the venture has been named as Luo Chuan, a former senior executive at software giant Microsoft.

Murdoch bought MySpace for $580m 2005 and has seen it dominate the emerging social network space online.

The sources said they could not specify how much money establishing the venture would require as a final agreement had not yet been reached.

News Corp has stepped up the international expansion of MySpace during the past year to combat flagging growth rates in the US. Local versions are now up and running in the UK, Ireland, Australia, Germany and France and in 2006 MySpace clocked up 79.8m users worldwide as of October.