The Smart Execs Leave Before The Fall.

Personally, I dont think the issue is leaving users, becuase facebook will deal with that too eventually (or at least hoards of inactive users). Rather, I think the issue here is the inability to reinvent themselves / make big changes becuase of their fun corporate overlords.

There are probably some awesome designers and developers that know the massive changes that needs to be made at myspace to make it a winner again, but are being given no incentive (or negative) to go after those changes.

The best part about BEING #2, which has served facebook, but which could also serve myspace in the future, is that you can learn on #1's dime. Look at their mistakes/problems, and fix them. Facebook has had notorious issues with their ad targeting system, their developer platform, etc. Myspace has bigger issues to fix first, but if given enough leeway they could fix their own issues and grow again.