NEW YORK (AP) — MySpace has extended its search and advertising deal with online search leader Google (News - Alert) Inc. for several years, though it's doubtful that it's worth as much as the original agreement the two signed in 2007.
MySpace said Thursday that Google will continue to power News Corp (News - Alert).–owned MySpace's search and advertising and will provide additional display advertising services. The previous ad–sharing deal between the companies expired in August and was extended for a month while they continued talks.
MySpace (News - Alert) is not giving financial terms of the deal. The previous deal was worth $900 million and spanned three years. But ad spending has fallen precipitously on the once–mighty online social hub in the age of Facebook and Twitter. Now, research firm eMarketer (News - Alert) estimates that worldwide ad spending on MySpace will be $297 million in 2011, down 37 percent from $470 million in 2009.
Rupert Murdoch's News Corp. bought MySpace for $580 million in 2005. MySpace started to lose its luster after a promising start. In the most recent quarter News Corp. said its "other" business segment, which includes MySpace and the rest of the Digital Media Group, reported an operating loss of $156 million, $30 million greater than a year earlier, mainly due to lower search and ad revenue at MySpace.