Is MySpace Records Slowly Going Under?

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Late last week, Alex Wilhelm of Crazed Hits, an A&R website, announced that, according to unnamed sources, Interscope partner MySpace Records had laid off most of its staff and effectively closed its doors.

Then, over the weekend, Digital Music News announced that the label was, in fact, still standing despite the departure of GM J. Scavo for greener pastures at his old label, Hollywood Records.

According to Digital Music News, MySpace Records’ artist roster, which includes minor success stories Kate Voegele and Mickey Avalon, will remain intact as executives at the company work out how to restructure the troubled label.

Speaking with Paste, a source at MySpace Records confirmed that the label had cut about half of its small staff in an effort to shift back to A&R, for which the company was originally intended. According to the source, who asked to remain anonymous, MySpace Records will continue to work with artists to find “new innovative ways of marketing new talent” while Interscope will be responsible for more traditional public relations and promotions.

Whether the label retools itself or shuts down altogether, it looks like hard times for MySpace Records and more bad news for the struggling music industry.