News Corp. to Put MySpace on Cell Phones in Japan

TOKYO – News Corp.'s Rupert Murdoch said on Monday he hoped to find partners to enter Asian markets for its MySpace.com Internet business and would discuss offering the world's most popular online community via cell phones with Japan's Softbank Corp.

The Nihon Keizai business daily reported earlier that News Corp. and Softbank planned to launch MySpace.com in Japan this month through a 50-50 venture, first offering services for personal computers and later allowing users to post photos and write blogs on mobile phones.

The report sent down shares in the biggest local player, Mixi Inc.

Murdoch, News Corp. chairman and chief executive, said "all sorts of things, like putting MySpace on mobile," will be up for discussion when he meets Softbank CEO Masayoshi Son. Murdoch was speaking on the sidelines of an international conference in Tokyo.

"If we do anything with him, which I hope we will in new media, it certainly won't be on an exclusive basis," Murdoch said. He added that finding partnerships is the preferable way to enter new markets, especially in Asia, for MySpace services.

Shares of Mixi, which debuted on the Tokyo Stock Exchange in September, tumbled 5 percent to 2.14 million yen due to investor concerns that MySpace could take away some of its subscribers.

Softbank's shares fell 1.2 percent to 2,410 yen, while the benchmark Nikkei average was up 0.1 percent.

MySpace, which has some 125 million users worldwide, may be attractive to the growing number of Japanese Internet users looking to share ideas and submit diary entries with a group of friends online.

"MySpace is seen as having a high potential in Japan," said Atsuo Takahashi, an analyst at Mizuho Securities.

"If Softbank can offer MySpace exclusively, it could be an effective differentiation strategy," he added.

Mixi, which began its service in 2004, has more than quintupled its members to over 5 million since last year.

News Corp. and Softbank, which jointly took a stake in a Japanese TV station in 1996, are expected to announce the deal as early as this week after a meeting between Murdoch and Son, the paper said.

The joint venture will start with capital of about 1 billion yen ($8.5 million), the Nikkei newspaper said.

Softbank spokesman Takeaki Nukii declined to comment.

News Corp. bought MySpace.com, which is popular with teenagers, last year for an estimated $580 million and has transformed it into one of the Internet's fastest-growing properties.

In Japan, there were about 7.16 million subscribers to so-called social networking sites as of March this year, and that number is expected to rise to 7.51 million by March 2007, according to government data.

GREE Inc., the closest rival to Mixi, this year tied up with Japan's No. 2 mobile phone operator KDDI Corp., to expand its service to wireless users.

Softbank's Internet arm, Yahoo Japan Corp., also offers a smaller online network service.

A research note by UBS said in June that News Corp. and Softbank would set up a joint venture to launch MySpace.com in Japan by mid-September, citing comments by Murdoch.

News Corp. is the parent company of FOX News, which operates FOXNews.com.