19 May 2008

AOL and Bebo - grand networking potential?

AOL today announced the completion of their $850 million purchase of social networking site Bebo and unveiled some of their social intentions.

The company revealed that Bebo would provide the hub for a new People Networks division which will allow for the integration of AOL's communication tools and media services with the networking site.

Joanna Shields, the former CEO of Bebo, has been put in charge of the division which will also include AOL's instant messaging tools AIM and ICQ as well as its email service.

Moreover, AOL will be able to utilize Bebo's 40 million-strong network to increase the potential of its display ad network - Platform-A. According to Brand Republic, Randy Falco, chairman and chief executive of AOL said:

"With the addition of Bebo and the creation of People Networks, AOL is uniquely positioned to capitalize on the exploding social media space by delivering a more personal experience for consumers and a better way for advertisers to engage them."

It will be interesting to see how AOL capitalise on their newly acquired advertising potential, with the profits of big players in the social networking field failing to meet targets or coming under fire for invasive advertising techniques in recent months.

On the other hand, Facebook and MySpace might find themselves with Bebo hot on their heels as AOL's online channels start to distribute Bebo's online dramas such as Kate Modern to a wider audience.

Combined with AOL's other purchases this year, the independent affiliate network buy.at and widget company Goowy, it appears that the search engine is gearing itself up to make a serious impact on the search world.

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