AOL to Close or Sell Bebo
April 8, 2010
After buying social network Bebo just 2 years ago for £450 million ($850 million), AOL may be ready to get rid of it. This news came as AOL acquisition head Jon Brod sent an email to the site’s declining 40 man staff, making it clear that they can’t continue investing in the site to battle rivals like Twitter and Facebook.
Brod wrote in the email that it’s clear Bebo has some tough competition after they evaluated the portfolio. Unfortunately, he continued, the site has been dwindling and will require too much investment to compete in the social networking industry. He added that AOL isn’t able to give more support and funding to Bebo right now in order to turn it around.
It won’t be until after a May 2010 review that AOL decides what they will do. They will sell Bebo if they can, but if that doesn’t work out, the site will just shutdown. The site, which is originally British, has a following in the UK. However, it never translated into a monoculture space in the US like Facebook, who’s now dominate in the country.
Plus, AOL wasn’t exactly a successful company for Bebo to be acquired by in the first place. The company is kind of known as one of the biggest internet failures, yet they have tried to reinvent themselves. In figures, the 40 million users on Bebo in May 2008, when AOL bought it, have dwindled to just 12 million now. The site’s traffic declined 12% in February alone compared to last year, according to ComSore Inc. Yet, it’s still possible that Bebo has potential if AOL can sell it to someone else.
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