04/17/2010 05:12 am ET Updated May 25, 2011

Why MySpace and the Internet Could Kill Rupert Murdoch

One of the many things that Rupert Murdoch is good at is dealing with failure. It is worthy of a business school case study how News Corp. has so often managed not to acknowledge or be blamed for its messes. This includes DirecTV, TV Guide, his MCI satellite joint venture, his great investment in China, the Times of London, pretty much every newspaper he's bought in the US, including, perhaps most notably, the Wall Street Journal, as well as all of Murdoch's Internet ventures--Delphi, iGuide,, and, most recently, MySpace, briefly the crown jewel of News Corp.

Sometimes he merely manages failure, as with the Times of London and the New York Post, whose losses he has shouldered for more than 30 years (representing, quite possibly, the largest aggregate loss of any media properties ever). Other times, he declares victory and sells off a troubling asset, as with DirecTV (he spent six years trying to acquire the company, then almost immediately got rid of it). Other times he just disappears the problem, as with most of his Internet investments (who even remembers them?). The job is not to be caught; the job is to keep others from perceiving him as a failure.

In this regard, MySpace is going to be a challenge. Murdoch's own public frustration puts a light on the problem. He has, in quick succession, fired two managers. Chris DeWolfe, its founder, went a year ago. Last week, DeWolfe's replacement, Owen Van Natta, got the axe. What's more, this past year, Murdoch hired Jonathan Miller, the former CEO of AOL, to solve the problem, which so far is intractably resistant to solutions. Miller is a curious choice for the job since he failed to rescue AOL.

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