21 May 2007

Yahoo! interested in Bebo?

Yahoo! is reportedly planning a takeover of Bebo, the most popular social networking website in the UK. According to the Sunday edition of the Daily Telegraph, Yahoo! is willing to part with a reputed $1 billion to seal the deal. The potential acquisition would see Bebo - founded by Michael Birch in 2005 - eclipse the $580 million paid by Rupert Murdoch's News Corp for global rival MySpace.

Social networking sites have become the internet's biggest phenomenon in recent years and allow users to chat and share photos and videos with other users across the globe. Estimates have shown that more than 60 per cent of UK teenagers currently have an active profile on at least one of the many social networking websites in operation. Bebo has around 25 million users worldwide compared with the 100 million or so MySpace users.

However, Bebo is no stranger to takeover speculation. Last year, US media giant Viacom made an unsuccessful bid for the service after also losing out on Myspace to News Corp, while a $300 million offer from BT was also rejected.

Both Yahoo! and major rival Google have tried previously to gain a foothold in the social networking market. Last year, Yahoo! had a $1 billion bid for Facebook rejected, while Google was equally unsuccessful in its bid to takeover Friendster - one of the pioneers of the social networking phenomenon.

Bebo founder, Michael Birch, is believed to favour floating Bebo on the stock exchange rather than selling up, but in the wake of a spell of high-profile internet deals in recent months - culminating in Microsoft's $6 billion acquisition of Aquantive - share prices of small, fast-growing internet companies have increased to reflect the growing demand for their services.

Yahoo! and Microsoft have previously been linked with a merger but talks between the two powers have seemingly led to nothing. However, it does seem apparent that neither Google, Microsoft or Yahoo! are intent on resting on their laurels and, in an increasingly cutthroat industry, are looking at new ways to increase not only their online presence through advertising, but their also their share of internet users as the battle to be number one service on the internet rages on unchecked.

Home | Careers | RSS | Contact Us | Newsletter

International sites: