In 2006, Jeremy Jackson—the buff, bronzed former Baywatch child star—couldn't imagine a world without Myspace. He was a single, underemployed actor in Los Angeles, an exhibitionist in need of an audience, and Myspace filled almost every need. He spent hours every day on the edgy social network, which was known as a pop music hub where artists such as Lily Allen and My Chemical Romance helped launch their careers. Jackson had more than a thousand "friends." He sold trucker hats and flirted with women. His profile page was decorated with Trojan Magnum XL condoms. He was the poster child for the Myspace lifestyle.

But things changed.

"I tried to cling to Myspace for a long time, hoping that someone there would come up with some idea to keep it alive," says Jackson, 30. "But my assistants and business partners finally beat it into my head that it was a dead horse. It's done. It's a joke. If you do stuff on Myspace, you just look sad."

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Jackson still hustles for attention on the lower rungs of fame—he currently stars in season five of Celebrity Rehab, in which he battles his addiction to growth hormones for cable television viewers. But he now does his digital communing on Facebook and Twitter. He hasn't checked his Myspace page since 2009.

At its December 2008 peak, Myspace attracted 75.9 million monthly unique visitors in the U.S., according to ComScore (SCOR). By May of this year that number had dropped to 34.8 million. Over the past two years, Myspace has lost, on average, more than a million U.S. users a month. Because Myspace makes nearly all its money from advertising, the exodus has a direct correlation to its revenue. In 2009 the site brought in $470 million in advertising dollars, according to EMarketer. In 2011, it's projected to generate $184 million.

In February, News Corp. (NWS), which bought Myspace and its parent company, Intermix, in 2005 for $580 million, started officially looking for a potential buyer at an asking price of $100 million, according to a person familiar with the sale process. Yet even in the midst of a frenzy for social media that has seen LinkedIn (LNKD) valued at $6.4 billion and Groupon rebuff a $6 billion takeover offer from Google (GOOG), barely anyone wants to buy Myspace. On June 9 the News Corp.-owned tech blog AllThingsD.com reported that a group of investors led by Activision Blizzard (ATVI) chief Robert Kotick was closing in on a deal. "Getting people to come back to something that in their minds has become less useful is an incredible challenge on the Web—just ask AOL," says Richard Greenfield, an analyst with BTIG. "Myspace has become an eyesore for News Corp."

It's an eyesore for users, too. Many Myspace pages appear to be host bodies for the worst kinds of advertising parasites. On the upper right-hand corner of the page for Zaiko Langa Langa, an African band Googled at random, a photo of a blonde in a tight T-shirt appears, asking, "Want a Girlfriend? View Hundreds of Pics HERE!" (It's an ad for a dating site called True.) Farther down, someone has posted footage of nearly naked jiggling buttocks. There hasn't been an update from the musicians in weeks.

Mismanagement, a flawed merger, and countless strategic blunders have accelerated Myspace's fall from being one of the most popular websites on earth—one that promised to redefine music, politics, dating, and pop culture—to an afterthought. But Myspace's fate may not be an anomaly. It turns out that fast-moving technology, fickle user behavior, and swirling public perception are an extremely volatile mix. Add in the sense of arrogance that comes when hundreds of millions of people around the world are living on your platform, and social networks appear to be a very peculiar business—one in which companies might serially rise, fall, and disappear.

Danah Boyd, a senior researcher who studies social networks at Microsoft Research (MSFT), attributes their instability to the way users can bind themselves by race and class, taste and aesthetics. Influential peers pull others in on the climb up—and signal to flee when it's time to get out. "The thing about user adoption and user departure is that it's not a steady flow," says Boyd. "Think of it as, you're knitting a beautiful scarf, and you're knitting and knitting, and you get a bigger and bigger scarf. Then someone pulls a loose thread at the bottom. And it all unravels."


In 2007, News Corp.'s belief in Myspace was best represented by architecture. The company was considering a redevelopment plan that would have moved its headquarters to the far west side of Manhattan. Sketches from the time show an alternate vision of the company's future anchored, front and center, by a gleaming Myspace pavilion. The other elements of Murdoch's old-media empire—the Wall Street Journal and New York Post newspapers, the Fox News television network—would be scattered around the company's new beating heart.