The news that MySpace is to axe up to half of its workforce is yet another sign that the beleagured social network will never compete with its heavyweight rivals Facebook and Twitter.

MySpace has fallen from great heights and the once dominant social network looks set to be sold by parent company NewsCorp, meaning it could possibly become obsolete altogether as consumer interest in the site wanes.

Where did it all go wrong for MySpace? The site was slow to innovate, had no real understanding about itself as a brand, held minimal financial control and seemed unable to keep up with its ever-ageing audience.

Here are the four reasons why MySpace appears to be failing:

Lack of loyalty to its users
MySpace was launched to appeal to “Generation Y”, 13-15 year olds with bit of internet nouse and an understanding about how to socialise online.

In 2005, when the site was at its peak, the site was brimming with teenagers writing on each other’s pages, becoming MySpace friends with their favourite bands and uploading their party photos.

The photos are still there, but now a little dated as its users flocked to Facebook. MySpace failed to adapt and appeal to its original market as they left their mid-teens and became young adults.

Lack of innovation
There is little comparison between MySpace and Facebook as a product. Facebook takes seconds to master and constantly adapts around a user’s network of friends, their likes and the games they play on the site. But whether a MySpace user has one friend or a thousand, the product will still work in largely same way.

Even with October’s redesign, MySpace still operates in a similar way to when it first launched, with only a handful of minor usability updates over the last five years.

MySpace was also slow to adopt technologies such Ajax, which allows users to send messages without the need to open a new browser window; programs to import e-mail address books into friends lists; and instant messaging. Facebook trumped it on all three.

Lack of understanding about itself
At the end of last year, MySpace’s chief executive Mike Jones admitted the site was no longer a social network but now a “social entertainment destination”.

The site had repositioned as it became obvious it was never going to compete with the leading social networking websites in its previous state. It had admitted defeat.

Brands should adapt to the changes within their market, but never make reactive decisions and change the market they operate in altogether.

Lack of control
Rupert Murdoch’s NewsCorp bought MySpace for around $580m in 2005 when it had 20 million unique users. Now MySpace is losing its parent company tens of millions of dollars each month.

NewsCorp has admitted the losses are neither “acceptable or sustainable” and its president Chase Carey said the social networking site was a “problem”.

MySpace is a small drop in the NewsCorp ocean and it could be argued that Rupert Murdoch’s empire focused more on revenues than user experience. In 2007 Murdoch told analysts that Fox Interactive Media, the division MySpace sat in and earned nearly all the division’s revenues, would generate $1bn in revenues in 2008 (up from $550m in 2007).

MySpace executives were pressured to make profit from the site immediately to substantiate the predictions, whereas Facebook’s investors were ready to take on early losses in order to invest for the future.

It seems MySpace could do with some better friends.