Rupert Murdoch on Myspace: We just messed it up

News Corp. executive chairman Rupert Murdoch isn’t regretting buying Myspace, but everything that came thereafter: “we just messed it up,” he told an audience at the Wall Street Journal’s WSJ.D conference in Southern California on Wednesday. Murdoch’s News Corp. acquired Myspace in July 2005 for $580 million, and ended up selling the social network for just $35 million six years later.

Murdoch said Myspace was “growing like crazy” when his company acquired the social network, which was before Facebook really took off. And Myspace had other bets that could have paid off for Murdoch: It was building a video service, which launched three months before YouTube, only to see the now Google-owned video service quickly take off and leave Myspace behind.

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Rupert Murdoch and Carlos Slim, interviewed by WSJ chief editor Gerard Baker.

So what went wrong? Murdoch said that he didn’t know what to do with the company, which is why he relied on bad advice, leading to News Corp. putting a layer of bureaucracy in place that eventually led to Myspace’s demise. Instead, he should have trusted the management in place when News Corp. acquired the site, or replaced it with completely new management altogether. The way News Corp. handled the Myspace acquisition turned it into “a very expensive mistake,” Murdoch said.

Murdoch went on to talk about Hulu, another digital bet that hasn’t always been easy for News Corp. He said that his partnership with Comcast and Disney had been “difficult” in the past, but added: “Now we are all on the same page, and we are going to drive this as fast and as hard as we can.” Murdoch went on to argue that Hulu was necessary in part because the industry needed a serious competitor to Netflix and Amazon.

Of course, Hulu isn’t the only company trying to compete with Netflix for eyeballs online. HBO announced that it will take its programming to cord cutters in 2015, and Murdoch said that he would have done “exactly the same” if he had won the bid for Time Warner. However, he cautioned that it will take some time for HBO to succeed online, in part because it will have to price the service at $15 to not cannibalize its cable TV business. “I don’t think it will be sensational for quite a while,” he said.