Social networking site MySpace, which was acquired by News Corp last year, is to buy photo-sharing site Photobucket for $250 million, according to reports.Photobucket was founded in 2003 by Alex Welch and Darren Crystal and works by linking media from one web site to multiple online sites outside Photobucket, such as MySpace, Facebook, Bebo, Friendster, eBay and Craigslist.
Members use Photobucket as a way of storing all their media for free and the site is linked to well over 300,000 different sites on the internet.
Photobucket has 41 million registered users and comScore reported 17.6 million unique site visitors a month in January this year.
Chief executive Alex Welch, 30, ran the site on credit cards for the first six months until its popularity forced him to borrow money from his parents, according to Reuters.
Photobucket is the market leading online photo sharing site in the US with 40 per cent of the market, well in front of second place Yahoo! with just ten per cent of the market.
Nearly 60 per cent of Photobucket site traffic comes from MySpace and it is the third most popular destination for MySpace users after Google and Yahoo!, according to Hitwise.
The news of the possible buy-out by MySpace comes after the two firms were in a disagreement over web advertising.
MySpace accused Photobucket of violating its terms of agreement by encouraging users to include advertisements in the media posted on MySpace.
Photobucket, on the other hand, claimed MySpace began blocking photo slide shows and videos from the site.
The dispute was resolved but several analysts see the dispute as a strategic move by MySpace to drive down the value of Photobucket by showing how much it relies on social networking traffic.
