Media giant News Corp’s Rupert Murdoch has warned its subsidiary social networking site MySpace that losses incurred by MySpace for the last couple of years are not acceptable for the company and the management of MySpace must take concrete steps to improve the situation.

News Corp president and COO Chase Carey said, “We’ve been clear that Myspace is a problem; we need to redefine and rebuild this business.” He adds” We’ve made adjustments in the cost structure and, most importantly in the last few weeks, we have re-launched Myspace with a focus on social entertainment.

Last week News Corp reported that MySpace team has begun a large-scale restructuring of the MySpace network, and has been given the task to not only maintain and increase the user base, but also create a business model that will allow MySpace to generate steady profits.

“Current losses are not acceptable or sustainable. Our current management did not create these losses but they know we have to address them,” says Carey. Carey said that they understand doing so would be difficult, but it has to be done. He also said that he wanted to see a “clear path to profitability” in “quarters, not years”.

It has to be recalled that News Corp bought MySpace in 2005 for 580 million dollars, when the network was the leader, but in recent years, MySpace has lost the battle to Facebook, as the latter now has a subscriber base of more than 500 million users, whereas Myspace has 150 million. Nevertheless, Chase Carey is sure that the company is quite capable to add tens of millions of more users, moving the business to an acceptable level.

Generally speaking the things at parent company News Corp are relatively cool, as the media firm in the third quarter increased net profits by 36% to 775 million dollars, which are above analysts’ expectations on Wall Street. The company’s revenue grew from 7.2 billion dollars last year to 7.4 billion dollars.

CEO Rupert Murdoch said News Corp continues to consolidate its presence in the media market, but also hopes that the advertising market in America as well as the world will be restored