AOL Buys Bebo To Regain Social Status

Discussion in 'Wall St. News' started by S2007S, Mar 13, 2008.

  1. S2007S

    S2007S

    Another great move, buying up another social media site for $750 million TOOO MUCH, when will anyone realize that this trend will soon fade, AOL paid way too much, company isnt worth more than $100 million. AOL trying everything and anything to stay in the game that they lost in 2000 when they paid 160 billion + for Time Warner.....Everyone is is buying up these overrated web 2.0 sites because they think that by not doing so they wont be with the in crowd. Well they should realize the web 2.0 is going to fade just like every trend that usually does....



    AOL Buys Bebo To Regain Social Status

    03.13.08

    discuss Total posts: 1

    by Chloe Albanesius

    AOL on Thursday announced that it would acquire social media site Bebo for $850 million in cash.

    The move is intended to better position AOL in the social media space, the company said. Bebo has approximately 40 million users, with a heavy presence in the UK, Ireland and New Zealand. In August 2007, Bebo ranked third in the United States behind MySpace and Facebook, according to Datamonitor statistics.

    In total, AOL will have a social network of approximately 80 million unique users worldwide, AOL said. However, those numbers also includes those using AIM and ICQ, both services AOL owns.

    AOL arguably helped create the concept of a social Internet, as its dial-up service was predicated on the use of message boards, chat rooms, and a "walled garden" approach where the network's own content was positioned as more appealing than the Internet at large. However, as more and more subscribers gravitated toward the Internet, AOL has been forced to compete on a more equal footing with other content providers, even backed by its parent, Time Warner. The young, meanwhile, tend to regard AOL as something their grandparents would use.

    However, Bebo also has made limited forays into the content business, producing Kate Modern and the upcoming The Gap Year for the Web.

    "What drew us to Bebo was its substantial and fast-growing worldwide user-base, its vision of a truly social web, and the monetization opportunities that leverage Platform-A across our combined global audience," said Randy Falco, AOL's chairman and chief executive, in a statement, referring to AOL's ad network.

    "AOL understands the shifting dynamics of the Web and has clearly demonstrated its commitment to leveraging the ever-increasing power of social networks," said Bebo president Joanna Shields. "With one and the same vision in this area, it was a natural progression for Bebo to join AOL."

    Shields will continue to run Bebo, and will report to Ron Grant, president and COO of AOL.

    Last week, AOL launched Open AIM 2.0, a program meant to increase third-party development on the popular instant-messaging app through the release of new SDKs and APIs.

    Bebo announced in December that it had developed its own application platform. Developers took the Facebook application development and put it on Bebo. It launched with 40 applications, including NBC Universal, Gaia Online, and Flixter.