The current competition within the social networking community is rather stiff, especially for Facebook runner-ups, but $275 million for restructuring MySpace is quite a blow to News Corp’s improved financial performance for Q4 of 2010. The devaluation was posted by Digital Media Group, the organization’s arm responsible for MySpace’s revamp and re-branding which has been on-going for some time now.

Chairman and Chief Executive Officer of News Corp, Rupert Murdoch noted significant details overall financial performance and MySpace was not even once mentioned. He said, “News Corporation’s second quarter results demonstrate the mounting vigor of our global channels business.

“In the U.S. market, our cable channels are still expanding and adding subscribers, while increasing their revenues and profits at a double-digit pace on the strength of affiliate fee increases and buoyant advertising markets. I am also pleased with the continued recovery of our U.S. broadcasting business, including our local TV stations and the Fox Broadcasting Company, which posted its best quarterly profit in two and a half years.”

In that second quarter financial report, MySpace’s poor performance under Digital Media Group has caused $156 million operating loss—a figure that is 5 times higher than the previous year’s budget of $31 million.  Losses that were accounted within “other” bucket of the same report.  This deflation stems largely from lower-than-expected revenues from advertising and searches at MySpace.

Aside from Digital Media Group, Filmed Entertainment also posted major beating from the same period.  The trouble was predominantly brought by its cable network programming and television segments, while publishing recovered from previous year’s failure to a healthy operating income- which was tickled by $500 million litigation settlement. In sum, News Corp operating income grew from $712 million to $1.29 billion.

MySpace’s overhaul has seen some negative impact not only with the business, but also with its manpower. Just recently, as reported by Isha Suri of SiliconAngle, the used-to-be-dominating-social-network laid off a total of 600 employees which accounts for almost 50% of their roster.