Google selected as MySpace search system

NEW YORK - News Corp.'s Fox Interactive Media today said it selected Google Inc. as MySpace.com's search system in a multiyear search and advertising deal that also covers some of Fox's other properties.

The deal ends months of speculation about which big search company, also including Yahoo Inc. and Microsoft Corp., would serve MySpace's popular online teen hangout.

As part of the deal, Google is expected to pay Fox at least $900 million in revenue share payments based on certain traffic and other commitments promised by Fox. These payments are expected to be made from the first quarter of 2007 to the second quarter of 2010.

One media analyst applauded the deal.

"It's a small amount of revenue in News Corp. over the last nine months," said Richard Greenfield, an analyst at Pali Capital. "However, the organic growth in MySpace, combined with today's deal, sets MySpace up to be an important driver for earnings growth for next several years."

Peter Chernin, Chief Operating Officer of News Corp., said in a statement: "Our partnership with Google underscores News Corp.'s continued evolution to become a powerful force in the digital media marketplace."

Google Chief Executive Officer Eric Schmidt said in a statement: "MySpace.com is a widely acknowledged leader in user-generated content and incorporating search and advertising furthers our mission of making the world's information universally accessible and useful."

- REUTERS