Feeds

AOL to sell or shutter Bebo

$850m mistake

Boost IT visibility and business value

It's uncertain whether Bebo will or will not survive into June, but one thing is certain: the declining social networking website will no longer be under AOL's wing.

In a memo obtained by PaidContent and published by Silicon Alley Insider, AOL Ventures' Jon Brod stated the obvious:

It is clear that social networking is a space with heavy competition, and where scale defines success. Bebo, unfortunately, is a business that has been declining and, as a result, would require significant investment in order to compete in the competitive social networking space.

Brod then upped the obviousness ante by saying: "AOL is not in a position at this time to further fund and support Bebo in pursuing a turnaround in social networking."

Exactly two years and three weeks ago, AOL bought Bebo for a hefty $850m. At that time, Bebo was in competition with MySpace and Facebook for top social networking site. We all know which Web2.0rheic property won that battle.

At the time of the acquisition, AOL's then-prez Ron Grant enthused: "Bebo's dynamic management team recognizes that the internet is less about destination and more about connecting people, culture and lifestyles," and added that: "This acquisition supports our key objectives – accelerating the growth, engagement and monetization of one of the world’s most engaged online communities."

Grant was shown the door one year later. Two months after that, AOL exec Joanna Shields, who came to AOL as part of the Bebo acquisition, was gone as well - "to reunite her family and explore her entrepreneurial interests", as explained in a memo from AOL's then-new CEO Tim Armstrong.

Jon Brod's recent memo is less euphemistic. After announcig the "sale or shut down of Bebo," Brod notes: "Obviously this is significant news - particularly for the Bebo team." Indeed.

According to Brod, AOL is "committed to working quickly to determine if there are any interested parties for Bebo." The company's self-imposed deadline for either finding a buyer or shuttering the once-promising site is the end of next month. ®

Seven Steps to Software Security

More from The Register

next story
Scotland's BIG question: Will independence cost me my broadband?
They can take our lives, but they'll never take our SPECTRUM
Bring back error correction, say Danish 'net boffins
We don't need no steenkin' TCP/IP retransmission and the congestion it causes
Auntie remains MYSTIFIED by that weekend BBC iPlayer and website outage
Still doing 'forensics' on the caching layer – Beeb digi wonk
NBN Co adds apartments to FTTP rollout
Commercial trial locations to go live in September
Samsung Z Tizen OS mobe is post-phoned – this time for good?
Russian launch for Sammy's non-droid knocked back
Telstra to KILL 2G network by end of 2016
GSM now stands for Grave-Seeking-Mobile network
Seeking LTE expert to insert small cells into BT customers' places
Is this the first step to a FON-a-like 4G network?
What FTC lawsuit? T-Mobile US touts 10GB, $100 family-of-4 plan
Folks 'could use that money for more important things' says CEO Legere
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.