• by Mark Walsh  @markfwal, July 13, 2009

The Wall Street Journal reports today that MySpace is transforming itself into an entertainment portal as the social networking site continues to lose ground to Facebook. Plans call for a greater emphasis on the video and music-related aspects of MySpace, according to the report, and would build on the site's strength as a place for bands and artists to showcase their music and attract fans.

A recent harbinger of this shift has been MySpace dropping the tagline "a place for friends" from its name. One question the effort to refocus on entertainment raises is how the shift affects the site's mobile strategy. Earlier this year, MySpace CEO Chris De Wolfe expressed big ambitions for the company's mobile business.

At the Mobile World Congress in February, he noted that MySpace's mobile audience had grown 400% in the last year to 20 million, and that nearly half its users would access the site via mobile in the next five years. He pointed to emerging markets such as China and India as fertile ground for expanding the social network's mobile user base.

Since then, De Wolfe has been replaced by Owen Van Natta and MySpace has cut 30% of its U.S. staff and up to two-thirds of its international workforce. Where does that leave mobile? Unlike the social network's flattening growth online, the rapid growth of MySpace Mobile in the last year suggests the company may be content to leave it as is for now to focus on overhauling its online presence.

It could end up that the mobile version has more of a social networking flavor than the MySpace site, depending on how usage patterns develop on cell phones versus the Web. But it either case, it will have still have to deal with an ascendant Facebook. The rival social network says it has 30 million mobile active users and that more than 150 mobile operators in 50 countries working to offer Facebook services on mobile devices.

Unlike MySpace, 70% of Facebook's more than $200 million users come from outside the U.S., giving it a stronger base for building its mobile audience internationally. Meanwhile, cutting staff and shutting offices abroad won't help MySpace expand its mobile business in developing markets like China and India.