UK

Rupert Murdoch Warns Facebook It could go Same Way As 'Crappy MySpace'

17/05/2013 17:10 BST | Updated 17/05/2013 17:22 BST
Alamy

Rupert Murdoch has warned Facebook to 'watch out' or it may end up going the same way as 'crappy MySpace'.

The media mogul turned to another social media outlet - Twitter - to issue his warning on the eve of the first anniversary of Facebook's troubled IPO which plunged the company into months of uncertainty.

Murdoch lost $545 million when he sold MySpace in 2011 just six years after buying the company for $580m, having failed to make a success of the social networking site.

Facebook shares fell sharply after the public offering when they were initially sold at $38 each. The price has recovered from its all time low of $17 in September but at roughly $26 is still way below the original price.

Mark Mahaney, an analyst at RBC Capital Markets, said he didn't expect the share value to reach its IPO level any time soon.

“The stock hasn’t seen 38 and I don’t think will see 38 within the next year,” he told the Telegraph, adding that he thought the shares were “materially mis-priced” for investors.