What is AOL going to do with Bebo? The web portal acquired the UK social network a couple of years ago, looking to make a huge dive into the media-sharing trends that were gaining at the time. While social media sites and services are still looked upon as having a great deal of potential for generating revenue, the actual execution of monetizing a networking hub is sometimes a far more difficult task. This looks to be the case with Bebo, but that wouldn’t be the first time for AOL or a social networking site to face the dire struggles of quickly-moving trends.
TechCrunch speculates that AOL may be better off abandoning Bebo all together, instead of selling it, as the cost of purchasing and running the site may be more than AOL bargained for. With an acquisition price of $850 million, the merge came at a heightened time of interest in social networking as big business. MySpace had already been acquired by NewsCorp, Facebook had received interest and investment from Microsoft, and Google had made its own moves into the social networking realm–YouTube, for one.
The desire to get a slice of the social networking pie was something all the major players had given way to, with a growing interest in its advertising potential. With Bebo having a hefty stronghold in the UK and a growing presence in the US and other countries, it seemed clear as to why AOL chose Bebo as an acquisition target. The social network was third behind MySpace and Facebook, and showed a good amount of promise as a media hub.
So what happened, and where are things left now? AOL had troubles of its own, constantly seeking to stay afloat by changing its product offerings and revenue structure. AOL eventually was separated from Time Warner, the company that had purchased it years prior, and sought a more self-sustained model for generating positive cash flow. More recently, a complete revamp of AOL looked to rebrand the company entirely, moving more towards a web-based portal to address search and resource needs. That left Bebo in a waist-high problem all its own, as both companies struggled to determine where it fit into the grand scheme of things.
Yet this story isn’t new. MySpace, too, is facing the revamp struggle, returning to basics in an effort to save the social network and its business. Frienster, hi5 and several others have faced similar obstacles, seeking ways to shift their monetary goals to reflect the ever-changing trends of their users. And while Facebook is on top right now, previous trends indicate that there will be another interest to steal its users later on down the line.
Part of the problem is the fact that social networks don’t necessarily need to be a single destination site anymore. While Facebook has managed to create a platform around its destination site, other social networks have been less successful with similar efforts that would encourage third party interaction with their own platforms. In this way, Facebook has helped to create the standards that enable it to remain largely intact as other networks such as Bebo continue to struggle.
Even Facebook is on the constant lookout for new monetization options, however. It’s clear that the previous concepts around social networking haven’t played out the way publishers and advertisers hoped, though their potential to provide more interactive forms of advertising have kept a large portion of that hope alive. Whether or not AOL and Bebo can work on something towards that end has surely been considered, though the effort may not be worth it for either party at this point.