Technology - Remaking Murdoch's Colossus - FORTUNE - Page 4

"The big fear is that MySpace is a fad and will decline when young people tire of it, as they did of its rival Friendster. And Murdoch wants to make sure he didn't spend $580 million on a trendy website that won't be important a year from now. 'To prevent it from becoming yesterday's fad, we have to give people more and more and make them feel a part of it,' he says. Speaking about MySpace and IGN whose raucous videogame sites hit a slightly older, more male demographic at an investing conference in mid-September, Murdoch said, 'Both are either $500 million mistakes, or they're going to look very, very smart.'
If they do end up looking smart, it will be because Murdoch figured out how to transmogrify a big old-media company into a lean, mean web machine something none of his peers has achieved. 'Rupert is doing what he's done in the past,' says Larry Kramer, president of Viacom's CBS Digital Media. 'He appears to be trying to get to size and scale quickly. In certain areas on the Internet, size matters. But it's got to work together.' "

[FORTUNE]

It will be a smart move in retrospect. Mark Pincus thinks News Corp should make a play at craigslist - for $1 - 2B. That would certainly be a very wise move but Newmark consistently says they are not for sale. And even if NewsCorp does make a move, ebay still owns 25% of the company and may have blocking provisions around a possible sale.