MySpace : History of Spam & Deception Exposed

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MySpace : History of Spam & Deception Exposed

Valleywag published a tell-all yesterday which exposes the company behind the creation of MySpace, eUniverse (later Intermix) as a spyware and spamming marketing company which used its questionable tactics to build its social networking empire with the help of spam mails to dating site members and millions of other web users. Prior to this article, MySpace was essentially the Viral Marketing phenom pushing social networking – and still is.

Sure, every success has to start somewhere, and its well known in the marketing world that the parent company which sold MySpace to News Corp was not a band of do-gooders; as their history and reasons behind the quick sale (including lawsuits against Intermix) have also been published in incredibly popular non-2.0 magazines such as Vanity Fair:

Chris DeWolfe and Tom Anderson won’t say how much they took home in the Fox deal. One source close to it put the number at about $15 million each.

Whatever the exact amount, it is certainly less than the nearly $23 million made by Richard Rosenblatt, a former Intermix C.E.O. But then it was Rosenblatt and his allies who pushed through the merger, at least according to three separate suits pending in Los Angeles County courts.

The suits—including one filed by Brad Greenspan, who founded Intermix—claim that the Rosenblatt cadre on the board cheated shareholders by selling the company for far less than its true worth, ignoring and even trying to scuttle competing bids.

Why would Rosenblatt et al. undersell the company?

According to Greenspan, it was partly to appease a venture-capital firm that had bailed out Intermix and wanted to turn a quick profit, and partly because Murdoch had offered to indemnify Intermix in a spyware suit filed against it by New York State attorney general Eliot Spitzer. (Spyware is illegal software that secretly transmits data to and from computers without the users’ consent; MySpace was not named in the suit.)

Intermix ultimately settled with Spitzer for $7.5 million, which it is paying off with News Corp.’s help, but the L.A. city attorney has filed a second spyware suit. A Fox spokesperson dismisses the charges in all four suits and says there was no indemnification agreement.

Greenspan left Intermix on unfriendly terms in 2003. Nonetheless, he remained the largest shareholder, and made approximately $48 million in the Fox deal. But he says he deserves more. MySpace, he believes, is worth between $4 and $5 billion. Rosenblatt scoffs at that figure.”

Beyond the non-shocker that Intermix was a spam and spyware haven and MySpace was essentially one of the tools they created to expand their distribution reach, exactly what other kinds of dirt does freelance journalist Trent Lapinski spill on ValleyWag that is shocking enough to cause an anti-MySpace backlash?

Tom Anderson did NOT create MySpace!

Oh my?!? Does this mean that Tom is not really my friend either?

Guess so. Trent adds that Tom is more of a partner-mascot than brains behind the outfit:

Most users don’t know that Tom Anderson is more of a PR scheme than anything else–the mascot designed to give a friendlier feel to a site created by a marketing company known for viral entertainment websites, pop-up advertising, spam, spyware, and adware. As MySpace’s popularity grew, the MySpace team moved to create a false PR story that would best reflect the ideals and tastes of its growing demographic. They wanted to prevent the revelation that a Spam 1.0 company had launched the site, and created the impression that Tom Anderson created the site, and the lie worked. According to Anderson, the bulk of his initial contribution is as follows: “I am as anti-social as they come, and I’ve already got 20 people to sign up.”

Other ‘shockers’:

* MySpace was a direct assault on Friendster.com.
* MySpace’s CEO Chris DeWolfe is connected to a past of spam
* MySpace.com is Spam 2.0

I suggest reading the entire Valleywag article, titled MySpace: The Business of Spam 2.0 (Exhaustive Edition), to get more juice on MySpace and its spammy background.

Does this mean that MySpace will spam you now? Not really as Fox Interactive is not going to ruin a good thing. They’re also doing their best to combat MySpace spammers.

Will this hurt MySpace? Probably not, but there is some coincidential timing between the publishing of this article on Valleywag and the announcement that Facebook is expanding beyond colleges and invites.

MySpace is now a social institution and will be for years to come. But it is a bit heart warming (or perhaps a reality check) to compare their shady past (which this story is about) and that of their massive search engine partner in Google.

Loren Baker
Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing strategy & development agency.
Loren Baker
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