When TechCrunch, the blog for startup fetishists, published leaked screengrabs of MySpace's just-launched music service, Michael Arrington wrote: "We’ve been pounding our sources for screenshots of the new service for weeks without any luck." Now we know what he meant. A tipster tells us, and another source confirms, that Arrington's been dating Dani Dudeck, MySpace's VP of global communications, for months.We're told Dudeck leaked Arrington not only the MySpace Music screenshots, but also tipped him to a story about MySpace friend-in-chief Tom Anderson's brush with the FBI as a hacker in the 1980s. The article served to burnish Anderson's rather questionable geek credentials. MySpace has helped Arrington's business in other ways besides feeding him stories. The News Corp.-owned social network was a major sponsor of the recent TechCrunch50 conference. Arrington has no issue bragging privately about his relationship with Dudeck. And Dudeck, our source says, has "no issues to sleeping with key influencers." Before Arrington, we hear, the rumor was Dudeck dated MySpace CEO Chris DeWolfe. But don't believe us — let's go to the tape. Check out this clip of DeWolfe and Dudeck together at the Sundance Film Festival earlier this year, caught by Kara Swisher for AllThingsD. The way Dudeck leans in to DeWolfe to stay warm tells you more than any of our anonymous sources. Kara's quippy response — "You don't have to love me" — reminds me of an anecdote my boss once related about Dudeck. The flirtatious MySpace flack accosted him at a conference last year and said, "We really need to work on our relationship." Sorry, Dani — Owen doesn't swing that way.
MySpace CEO Chris DeWolfe wanted a one-stop music shop that would have included event ticket and merchandise purchases along with streaming audio and paid downloads. What he got were agreements from the four major labels for the streaming audio and a deal with Amazon to sell digital downloads. Which is something. Also, there's handful of big-name sponsors like McDonald's and Toyota, and MySpace certainly still has a huge user base of music lovers. Whether or not this is "the one" for the record industry remains to be seen. How's the service?Of course, it's highly-compressed digital audio, and therefore pretty crappy. But I have to admit, the offerings go well beyond the pop selected for the Jonas Brothers' playlist — while I'm sure the cashiers at Amoeba Records might still sneer at the selection's depth, my searches for everything from Os Mutantes to Gas Huffer, Blind Willie McTell to Mongo Santamaria came up with multiple tracks to choose from. Eventually. The site is currently running incredibly slow, which may be a good sign of interest or a critical fumble of the launch. Users frustrated in the process of creating playlists might just go back to Last.fm, Imeem, iTunes or any of a number of other places to preview and purchase tracks.
MySpace Music, a joint venture between the News Corp. social network and music labels Universal, Sony and Warner,finally launches next week, says Fortune, though it still won't have a CEO. MySpace users will be able to listen to and organize playlists full of songs from all three music labels for free. (EMI is the lone holdout, which means no coldplay.) Playlists will include affiliate links to Amazon.com's MP3 store. MySpace CEO Chris DeWolfe says ad revenues and song kickbacks are going to save the music industry, replacing lost CD sales.Imeem CEO Dalton Caldwell, whose company already offers a similar product,
Preeminent among the magazine world's kingmaking power lists is Vanity Fair's New Establishment, which appears in the October issue — on newsstands in L.A. and New York today, but not in the Bay Area for another six days. Silicon Valley gets similar short shrift: The names who make it there are predictable bigs like Steve Jobs and Larry Ellison, or Hollywood-crossover types like Jeff Skoll, eBay's first employee turned movie producer. Walt Mossberg, now employed by New Establishment perennial Rupert Murdoch, also squeaked in. The consolation prize Vanity Fair offers: Its "Next Establishment" list, reserved for the likes of Twitter's Ev Williams. It's a marvelous piece of New York media trickery — flatter the geeks by making them feel included, but corral them into a side room so the real power brokers aren't offended by comparison. True, the "Next Establishment" suggests that these are people who might matter in the future. But in saying that, Vanity Fair's editors are also sending the message that right here, right now, its "Next" nominees are nobodies. On this year's list:
News Corp.'s online arm, Fox Interactive Media, has struggled to attract online talent while paying them like a startup would. (News Corp. shares just don't cut it.) The solution for the unit, which includes MySpace and a passel of lesser-known websites: a long-term incentive plan, or LTIP, which offers a sort of phantom equity to executives in the division. In the last few weeks, the numbers for the most recent fiscal year which ended June 30 were distributed, and they were "disastrously low," says a tipster. "Most executives were already looking to leave," he says. "They hated FIM and the only reason they were staying was because of promises made about the LTIP." True, FIM hasn't quite made its aggressively optimistic numbers. But executives believe the real reason their bonuses are so low is MySpace CEO Chris DeWolfe's fat contract.DeWolfe and his MySpace cohort, Tom Anderson, renewed their contracts last fall with News Corp. last year for $15 million apiece, spread over two years. Paying that amount has, FIM executives believe, left nothing for them. "They're pissed," says our tipster. Then again, do these puffed-up Fox executives deserve much more than they're getting? Pop quiz: Name a Fox Interactive property other than MySpace.
That's so not hot: Chris DeWolfe, the CEO of MySpace, is dating Paris Hilton, Michael Arrington reports. Or if not dating, they've at least been seen together a lot, from Hollywood to the Hamptons. We wonder: Is it a coincidence that Hilton has fallen into DeWolfe's circle? Only two months ago, we reported how MySpace's security holes had further exposed the starlet, by making her supposedly private photos on the social network public. DeWolfe is married, but separated; Hilton has another boyfriend. So perhaps this isn't so much dating as tech support.We kid, of course. What this really confirms is what we knew all along: DeWolfe is a wannabe Hollywood type; rather than a hit movie, he has a hit website. Or had. It's precisely when stars begin fading that they begin prime targets for the paparazzi. MySpace has seen better days. As has DeWolfe. That he's hanging out with the likes of Hilton tells us all we need to know about the future arc of his career. It reminds us, in fact, of the idea of Yahoo merging with MySpace. Yes, that once seemed hot, too.
Little has been heard from Slingshot Labs, the startup "incubator" News Corp. formed in February, in the months since its creation. The $15 million fund for spinoff ventures did succeed in keeping MySpace CEO Chris DeWolfe in place: We hear that he made it a quid pro quo before signing a new, lucrative contract with Rupert Murdoch. He's not the only MySpace employee Slingshot played a part in keeping down in Los Angeles. We hear Nick Granado, a top engineer behind MySpace's iPhone version, first flirted with a job at Facebook, then worked briefly at Imeem, before getting lured back with a gig at Slingshot.
LiveJournal founder Brad Fitzpatrick is a prankster, as evidenced by his Halloween costume last year, when the new Googler dressed up as Facebook to mock his coworkers' fears of the social network. I'm told that in Once You're Lucky, Twice You're Good, Sarah Lacy's new book about Web 2.0, there's an anecdote about Fitzpatrick submitting an expense report — successfully! — for "hookers and blow" when he worked at blog software startup Six Apart. That was likely a reference to the early days of LiveJournal, when users made ridiculous accusations that Fitzpatrick was spending money meant for servers and bandwidth on "hookers and blow." We'd love to hear more, but alas, Fitzpatrick only got 8 out of 294 pages, according to the book's index. Here's the page for "D" through "F":
Fox Interactive Media — the unit overseeing MySpace and other News Corp. online properties — will miss its fiscal-year revenue projections of $1 billion by more than 10 percent, or $100 million, the WSJ reports. As a result, Fox Interactive chief revenue officer Michael Barrett is out of a job. The big problem is making money off of MySpace. It has lots of users, but as MySpace advertising partner Google has discovered, brands don't want to put their product next to Tila Tequila. So now MySpace is going to try something we thought Facebook would do — create an ad network that targets MySpace members when they visit third-party sites. It'll be called the "Fox Interactive Media Audience Network," and Adam Bain will run it. PaidContent obtained a memo from Peter Levinsohn, president of Fox Interactive Media on the reshuffling and it's pasted below.
Here's what the CEO of MySpace said about his new deal with three record companies: "This is really a mega-music experience that is transformative in a lot of ways... It's the full 360-degree revenue stream." Using the words "mega-music" and "full 360-degree" in an interview with the Times is, well, it's as vapid and gaudy as your typical MySpace page. Here's a less barf-inducing description of the probably-doomed music site the CEO was talking about:
Google missed Wall Street's expectations last quarter and during a conference call with analysts, CEO Eric Schmidt and the gang blamed ad partner MySpace. This news shocked, simply shocked, MySpace cofounder Chris DeWolfe, he tells interviewer Kara Swisher in this clip. He has "no idea" what all that was about, he says. Then — uh oh, it's slippery! — DeWolfe starts to backslide.
You might be surprised to learn that MySpace is bigger than Google. This, according to Barbara Walters, or at least the notes MySpace PR flack Dani Dudeck handed her before she interviewed Chris DeWolfe and Tom Anderson. Don't miss the tough questions like, "If I were a Martian. I come down from outer space. I hear about something called My Space. What is it?"
MySpace plans to double its workforce over then next year to add features, expand and compete with Facebook. The company also wants to expand to 30 countries from the 23 it's in. "We'll run out of people in the U.S. Our goal is to be No. 1 in every market and the biggest Web site in the world,'' says MySpace CEO Chris DeWolfe. With Google hiring continuing unabated and Facebook wanting to double its workforce as well, where are all the employees going to come from? Sergey, Chris and Zuck: I will blog for options.
The deal that MySpace founders Chris DeWolfe and Tom Anderson got from Rupert Murdoch will pay them more than every exec at News Corp. except Roger Ailes, the head of Fox News. Nikki Finke notes that their pay package is particulary impressive because News Corp. is stingy with executive compensation. The pair are rumored to receive $15 million spread over two years — plus equity in MySpace China.
What are the terms of the new contract between MySpace founders Chris DeWolfe and Tom Anderson with their corporate daddies at Rupert Murdoch's News Corp.? "$30 million over two years," suggests Valleywag —which sounds a lot less cute when you put it as "News Corp countered with an offer of $15 million each spread over 2 years," as Nikki Finke did. But, but, that's only $7.5 million a year! How are they supposed to party like rock stars? [DHD]
When I got home from covering the Web 2.0 Summit keynote with News Corp. CEO Rupert Murdoch and MySpace CEO Chris DeWolfe, I found the following email in my inbox: "This information is not for on-the-record use, it’s simply a background overview for your reference if you‘re planning to cover tonight’s discussion." Funny, I never recall asking for this document, let alone agreeing to keep it off the record — an arrangement that, in my experience, requires the mutual consent of reporter and source. So here, forthwith, are News Corp.'s official talking points about Wednesday night's event. Contrast them with my live reporting. Of most vital interest: The new San Francisco office is hiring 200 people.
WEB 2.0 SUMMIT — "I'm happy to say I'll have a job for the next two years," says Chris DeWolfe, CEO of MySpace, on stage with conference organizer John Battelle and his boss, News Corp. CEO Rupert Murdoch, confirming widespread rumors that he and MySpace cohort Tom Anderson had renewed their contract to run the social network for another two years. "I had to go from the nickel-and-dime newspaper culture, to the magazine culture ... to Hollywood and the Internet culture," says Murdoch, nodding to the reported — but unconfirmed — figure that DeWolfe and Anderson would make: $30 million over two years. More live coverage, after the jump.