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MySpace and Google deal – does this mean I could not have been more wrong?

I have posted on the value of MySpace extensively before and my central argument has been that whilst they have an incredible amount of traffic and they are clearly worth something there is far too much that is unproven about their model for them to be worth a lot of money (say maybe $580m??).

And now Google have done a deal with them worth a minimum of $900m over three years.

So did I speak to soon?

It is starting to look like the answer to that question may be yes, but for the following reasons I’m not giving in just yet:

  • This deal covers other Fox Interactive properties like IGN
  • $900m isn’t much for Google to tie up the traffic and maintain their monopoly – their may be a “strategic” rather than hard cash rationale for this deal.

You can find more detail on Jeff Clavier’s site.

  • http://www.freddestin.com Fred Destin

    Nick: I understand the split is 90/10 so value to MySpace = 90% of the deal. Not bad huh ?

  • http://www.freddestin.com Fred Destin

    Nick: I understand the split is 90/10 so value to MySpace = 90% of the deal. Not bad huh ?

  • nic

    Thanks Fred – I’m going to have to concede that Myspace was worth the $580m.

    Nic

  • nic

    Thanks Fred – I’m going to have to concede that Myspace was worth the $580m.

    Nic

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