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The restructuring continues at MySpace, whose staff will get cut by almost 30 percent, the News Corp. division announced Tuesday. MySpace’s staff is “bloated” considering the “realities of today’s marketplace,” which prevents it from operating with efficiency and innovation, MySpace said in a statement. The layoffs will affect all U.S. divisions and will leave MySpace with about 1,000 employees in the country. Once the undisputed champion of social networks, MySpace has seen its growth stagnate over the past year, while Facebook surpassed it to become the most popular social-networking site in the world.

The U.S. Internal Revenue Service is now recommending that a complicated law that would tax personal usage of business cell phones be repealed, after the agency caused an uproar last week with attempts to simplify the law.  On Tuesday, IRS Commissioner Doug Shulman asked Congress to make it clear that neither businesses nor employees will need to pay taxes on personal use of cell phones provided by employers. Just last week the IRS requested public comments on ways to clarify the decades-old law. The request created an uproar because it implied that the largely ignored rule would now be enforced.

A group of U.S. senators plans to discuss possible issues with handset exclusivity deals this week, and they’ve asked the Federal Communications Commission to also examine the practice.  On Monday, four members of the Commerce Subcommittee on Communications, Technology and the Internet sent a letter to the FCC expressing their concern around agreements, like the one between Apple and AT&T, that allow an operator to exclusively sell a phone for a period of time.  Based on a request that a group of rural operators sent asking the FCC to examine the practice, the senators say they wonder if the exclusive agreements restrict customer choice of handsets depending on the user’s geographic location, limit a consumer’s ability to use certain technologies like multimedia messaging services and tethering, inhibit the ability of smaller operators to compete and discourage innovation in the handset market.

Nvidia hopes to develop chips that enable applications such as image recognition and video search on mobile devices like smartphones and low-cost laptops, CEO Jen-Hsun Huang said on Tuesday. More Web sites are posting high-definition video, and thousands of hours of video are continuously added to the Web, so such applications could allow users to search for specific images in videos and enhance the Web for mobile device users, Huang said during a speech at Nvidia’s analyst meeting that was webcast. However, those applications require heavy graphics processing capabilities that are mostly seen on high-performance PCs like workstations, Huang said. Nvidia hopes to develop mobile graphics chips that ultimately enable those applications to work on mobile devices, he said.

…And those are the top stories from the IDG Global IT News Update, brought to you by the IDG News Service. I’m Sumner Lemon in Singapore. Join us again later for more news from the world of technology.

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