MySpace has announced that nearly half its employees around the globe will be laid off in a broad restructuring of the foundering social network. About 500 employees, or 47% of the company's global staff, will be let go, CEO Mike Jones said in a statement on Tuesday.

"These changes were purely driven by issues related to our legacy business, and in no way reflect the performance of the new product," Jones said.

The MySpace redesign in October transformed the site into a media hub that takes users' "likes" from Facebook and creates a personalized one-stop portal for music, movies, games and celebrity gossip. While the new site offers a cleaner, more streamlined look, the move was widely seen as an unofficial acknowledgment that Facebook now dominates social networking.

With the redesign in place, it appears owner News Corp. may be positioning MySpace for an eventual sale. In November, COO Chase Carey told Reuters a merger with another company "would have been largely a pretty tough sale process" before the new product was launched.

Even with a new product, MySpace may not be able to recapture its past glory. Facebook surpassed MySpace in traffic in June 2009, according to comScore, and the two sites' revenues are headed in opposite directions. Revenue figures published in the New York Times put MySpace ad revenue at about $300 million in 2011, down from $470 million in 2009. Facebook had revenue of close to $2 billion in 2010, according to a report by Bloomberg, up from between $700 million and $800 million in 2009.

In the music world, MySpace has lost its role as the de facto place for musicians to reach their fans and share their music. Facebook has become an increasingly popular marketing tool for artists. After all, artists need to reach their fans where they spend time, and fewer of them are spending time at MySpace. At the same time, services like SoundCloud and Bandcamp have quietly become popular ways for independent artists to share and distribute their music online.