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November 08, 2006

MySpace Blocking MySpace Founders New Sites

posted by MR WAVETHEORY at 11/08/2006 09:43:00 PM

MySpace is blocking MySpacer founder, Brad Greenspan's, new sites called VidiLife and Stickam. Something tells me this has to do with the $20 billion suit that Brad Greenspan filed against News Corporation (NYSE NWS) for selling MySpace for just $237 million when it was worth $20 billion. He accused News Corporation of a $20 billion fraud.

In case you were wondering, the VCs behind the MySpace sale were VantagePoint Venture Partners and Redpoint Ventures. The structure of the deal was very unconventional, because VantagePoint had put money into eUniverse which was a public company in a convertible round while eUniverse stock was languishing in penny stock land. eUniverse then began to take off and eUniverse launched MySpace. Redpoint, aka Geoff Yang and company, invested in MySpace after the launch. In the meantime, eUniverse renamed itself Intermix Media which was the entity bought by News Corporation. The VCs were responsible for the sale. In summary, Brad has a beef against VantagePoint and RedPoint. Got the point?
Brad Greenspan, the man who helped launch MySpace in 2003 but left to start a new company, has launched a legal campaign against the site's owner, News Corp, alleging "anti-competitive behaviour".

The suit was filed last week with the Federal District Court in Los Angeles, and alleges that MySpace has broken antitrust laws by censoring competitor services.

Greenspan's new company, LiveUniverse, owns a number of internet properties, including social networking site Stickam.com and YouTube competitor Vidilife.com. He alleges that MySpace blocks users from even mentioning Stickam.com and Vidilife.com in their profiles.

He says that "any attempts by users to type the url of sites like 'stickam.com' or 'vidilife.com' into a [MySpace] blog or profile [are replaced] with '......' ".

He also claims that MySpace has previously imposed the same "censorship" on other video sharing sites such as YouTube and Revver, but stopped this after a revolt from its users. However, the censoring of Vidilife.com and Stickam.com remains.

"When we started Myspace in 2003, we empowered users by giving them full control over their profile pages," Greenspan said.

"News Corp's moves to destroy and limit the freedom MySpace users have enjoyed is analogous to the strategies a dictator would employ after seizing control of a previously free nation."

In the repartee, News Corporation answered that it was because the content on Greenspan's sites were copyrighted.

"MySpace generally blocks links to websites for three reasons: adult content, copyright infringement, and security risks," the company said in a statement.

"Universal Music Group identified vidiLife.com as a website that is a primary source of infringing UMG content. We continue to look into the matter."

I don't buy that. YouTube has tons of copyrighted content and MySpace allows YouTube content on its site.

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