NEW YORK - US INTERNET social networking giant MySpace said on Tuesday it would cut 500 jobs, nearly 30 per cent of its domestic staff, in a restructuring aimed at boosting efficiency.

MySpace, a unit of media magnate Rupert Murdoch's News Corporation, said it was cutting payrolls 'as part of a plan to restructure itself into a more innovative, efficient, and entrepreneurial business'. The restructuring plan affects all US divisions of the company and the round of job cuts will lower the domestic workforce to 1,000 employees, it said in a statement.

To be run like a media company THE job cuts are a sign that News Corp intends to run MySpace like a division of a media company, according to Mr Bernoff. 'In a public company like News Corp, they don't allow people to spend whatever money they need to in the hopes it will pay off some time in the future, which is sort of what is happening at Facebook,' Mr Bernoff said. ... more

'Simply put, our staffing levels were bloated and hindered our ability to be an efficient and nimble team-oriented company,' said Owen Van Natta, MySpace chief executive.

'I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace. Our intent is to return to an environment of innovation that is centered on our user and our product.' Mr Van Natta, who was named MySpace CEO in April, was a chief revenue officer and vice president of operations for Facebook. He resigned from the rival company in early 2008.

Facebook replaced MySpace last year as the world's most popular social network, and industry figures show it has been widening its lead.

Facebook was the top social networking site when ranked by total minutes for the month of April, showing a gain of 700 percent from a year earlier, according to a recent study by Nielsen Online.

MySpace was in second place, with its total minutes declining from 7.3 billion in April 2008 to 5.0 billion in April 2009, the survey showed.

MySpace claims 130 million users compared with Facebook's audience of 200 million.

'The fact is that MySpace has lost a lot of momentum to Facebook,' said Forrester analyst Josh Bernoff, co-author of the book 'Groundswell' about the rise of online social media.

'MySpace has become much more of a service where people connect around media as opposed to a success as a general site for social networking.' Despite the newly announced employee reductions, MySpace's workforce will remain larger than Facebook's staff of about 900. -- AP