MySpace after new contract

The Google search bar on MySpace. Photo / Supplied

News Corp's MySpace, seeking to replace a search advertising contract with Google that expires in August, has held talks with Microsoft and Yahoo, according to a person familiar with the company's plans.

Any deal would carry a substantially lower price than the US$900 million Google agreed to pay in 2006 to place search ads within the social-networking site, a person with knowledge of the discussions said. MySpace also remains in talks with Google about extending their partnership, the person said.

MySpace has struggled to maintain ad revenue during an exodus of users to Facebook and the departure of key executives.

Bought in 2005 for US$580 million in cash, MySpace lost its status as the world's top social-networking site in 2008.

News Corp chief executive Rupert Murdoch said last year that the site would fall short of traffic commitments to Google, lowering income on that deal by US$100 million in 2009.

"We're currently talking to multiple providers across the many facets of search to bring our users the best possible search experience in a social environment," said Tracy Akselrud, a spokeswoman for Beverly Hills, California-based MySpace, who declined to name specific companies.

Microsoft is looking to boost users and ad revenue for its 13-month-old Bing search engine, which claimed 12.1 per cent of searches in the US, compared with Google's 63.7 per cent, according to data tracker ComScore. Microsoft has forged a separate agreement to handle searches on Yahoo's site - a deal that's scheduled to take effect by December.

Pete Wootton, a spokesman for Microsoft, declined to comment on negotiations with News Corp.

May Petry, a spokeswoman for Yahoo and Jane Penner, a spokeswoman at Google, also declined to comment.

- BLOOMBERG