Did MySpace Botch Handling of Imeem Acquisition?

By Tara Lane, Staff Writer

Imagine yourself sitting in front of a computer, happily listening to music from your favorite online streaming service. All of a sudden, the music stops, and the page refreshes to something you’ve never seen before, with an announcement that your favorite service is no longer available. Sound far-fetched? It shouldn’t. Earlier this week, it’s exactly what happened to thousands of imeem users across the United States.

Imeem, a popular music streaming site similar to Pandora and Last.fm, was acquired by Myspace Music that same day. It abruptly switched users to a landing page informing them of the change, with no advance notice of what was happening. Myspace claims that users’ playlists will be restored at some point in the future, but in the meantime it seems everything is sitting in limbo.

From a business perspective, it’s hard not to take note of what happened in this situation and the way it was handled. In a matter of seconds, they turned the lights out on 4 million users. Not only did these users lose their playlists, they weren’t given any notice of what was going to take place. Often when acquisitions happen, people are given fair warning of what’s going on, and what to expect because of it. Potential changes are announced, and if the acquisition is major enough, it even makes headlines.

Consider Amazon’s acquisition of Zappos. Amazon greatly benefited by not only acquiring the rights to sell Zappos products through their own online service, but also the ability to learn Zappos’ customer service techniques which made them so popular in the first place. Zappos kept it’s name, and nobody had to lose their jobs. Zappos CEO Tony Hsieh handled the situation brilliantly, sending out an announcement to all employees detailing exactly what the acquisition would mean for everyone, from C-levels and down, and even publishing it online for the general public and customers to read, too.

The reason why Myspace acquired by imeem is still up for discussion. In October, imeem partnered with Google to provide links to imeem streams within search results. They seemed to be doing well, despite major competition. Myspace on the other hand, while still having a significant amount of users, is in a period of decline, losing out to more popular social networks with better features and a wider audience. A move like Tuesday’s can only hurt, not help.

If Myspace wanted to use this acquisition to their advantage, there are a few ways they could have handled it. First, they could have easily announced it via e-mail (to register users), or developed a pop-up notice on the imeem page. Even if it had been done just hours before, it would have been something. Second, they could have written up a news release and sent it out to popular social media blogs, or even have released it over Twitter.

Although Myspace Music is popular for bands, it’s not the first place many users flock to stream music. Pandora, Last.fm, Playlist.com, and now an iTunes web version all stand as tough competition. If Myspace does manage to restore users’ settings, how many will make the switch? Many have already found a new place to stream from. Businesses can learn many lessons from this, especially when it comes to customer service and public relations. Hopefully, Myspace can learn their own lesson, and handle future situations with more commitment to the customer.

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