News Corp. focusing on Photobucket
EmptyNews Corp. is close to finalizing its next acquisition, but it isn't Dow Jones & Co.
Rupert Murdoch will pony up as much as $300 million to buy the fast-growing image-sharing Web site Photobucket, according to published reports. Photobucket will come under News Corp.'s digital division, Fox Interactive Media, which houses MySpace.
An FIM spokesman declined comment.
The acquisition would represent quite an about-face between Photobucket and MySpace, which just last month enacted a two-week ban on the photo and video links the service embeds on the site because Photobucket was selling ads that appeared on MySpace.
FIM might have been moved to snap up Photobucket as its fate came to seem increasingly intertwined with MySpace. Photobucket received 59% of its traffic directly from MySpace during the week ending May 5, according to research firm Hitwise, which counts Photobucket as the 22nd-most-visited Web site in the U.S. during that period.
Photobucket has doubled in size during the past year, boasting 38 million registered subscribers and 17 million unique visitors per month, according to comScore. The site serves 2.5 billion images every day.
The four-year-old company enables social networking sites to embed Photobucket widgets on their pages that can display slide shows or videos. In addition to MySpace, Photobucket is a fixture of other popular sites, including YouTube, Facebook and Xanga.
The acquisition likely played a part in a squabble last month between MySpace and Photobucket in which a proliferation of user-generated advertisements for "Spider-Man 3" spurred MySpace to shut down the service.
Photobucket, which gets an estimated 80% of its revenue from advertising, even took a shot at MySpace before the social networking giant reinstated Photobucket.
"MySpace became successful because of the creativity of its users and because it offered a forum for self-expression," Photobucket wrote on its blog. "By severely restricting this freedom, MySpace is showing that it considers its users a commodity which it can treat as it sees fit."
The acquisition of Photobucket also comes after speculation on media-sector M&A activity reached a fever pitch last week, though the photo service was not mentioned among acquisition candidates like Dow Jones, which faces a $5 billion buyout offer from News Corp., or rumored tie-ups between Thomson and Reuters or Microsoft and Yahoo.
Alex Woodson in New York contributed to this report.