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MySpace Axing Two Thirds Of International Staff, Katz’s Position Unclear

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MySpace’s cuts, announced for the U.S. last week, are spreading as expected. The company will slash its international staff by two thirds, from 450 to 150, and close at least four international offices as part of cuts that affect “all international divisions of the company.” It brings the total jobs lost in this round of restructuring at MySpace to 720 globally.

SEE ALSO: MySpace Cuts U.S. Staff By Nearly 30 Percent

Just days after cutting nearly a third of its U.S. staff, the News Corp-owned company says it wants to run its non-U.S. business from three “primary regional hubs”: London, Berlin and Sydney—all the other offices (in Argentina, Brazil, Canada, France, India, Italy, Mexico, Russia, Sweden and Spain) are now “under review for possible restructure”, although the company isn’t giving a regional breakdown. MySpace China, a locally owned and managed division, and MySpace’s JV in Japan will be unaffected.

Mediaweek and Techcrunch both report London-based international MD Travis Katz is on the way out after three years with the company. MySpace told us it wouldn’t comment on rumours surrounding individual staff—but it certainly isn’t confirming his departure. Companies the UK and other European countries including France have to hold statutory consultancy periods in which they consider all options with staff before making layoffs. In the UK that typically lasts 30 days, so that’s why the Euro cuts are only “proposed” at this point and why some individual departures aren’t being confirmed yet.

MySpace CEO Owen Van Natta, in the release, gave the same reasons as for the US cutbacks: “With roughly half of MySpace’s total user base coming from outside the U.S., maintaining productive and efficient operations in our international markets is important to users worldwide and our immediate financial strength. As we conducted our review of the company, it was clear that internationally, just as in the U.S., MySpace’s staffing had become too big and cumbersome to be sustainable in current market conditions. Today’s proposed changes are designed to transform and refine our international growth strategy.”

This effectively heralds the end of three years of European expansion for the company. When we interviewed SVP for European marketing and content Jamie Kantrowitz back in 2006, MySpace was busy opening offices and expanding into what is now 21 separate European territories. But despite leading the social networking boom at the start of this decade, MySpace has fallen behind badly—Nielsen stats show that while unique users to Facebook grew 114 percent between February 2008 and February 2009, MySpace’s UUs dropped by two percent.

The strategic shift away from international was already signalled by a shift in importance away from international—Kantrowitz is now in New York as SVP of global strategy and marketing—while Jay Stevens, one of the first MySpace execs to be posted to the UK, left earlier this month to join online ad startup Rubicon.

UPDATE: Techcrunch has obtained a memo to staff from Van Natta—in which he admits the company’s “goal to tap into as many international markets as possible drove us to create too many offices around the globe, and with them came inefficiencies”. He continues: “We will refocus our efforts on regional business partnerships and integration in a smaller number of territories, while retaining a robust international presence.” He also confirms that the job cuts are only “proposed” due to European employment law.

Jun 23, 2009 4:43 AM ET

Travis Katz, MySpace International MD


Posted In: Social Media, Community, Companies, News Corp., MySpace

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