America Online and its parent company Timer Warner have jumped into the social network market in a big way with the purchase of Bebo. It came with a hefty price tag of 850 million dollars, but it finally positions AOL and Time Warner in the very growing social networking phenomenon that it seems has taken over the net. With Microsoft takeover bids of Yahoo this looks like a move that AOL needed to do to keep up with the giants in the Internet world. Yahoo had hoped that Time Warner would come to the rescue and outbid Microsoft, but that is definitely out the window with this purchase.
Bebo is has more than 40 million users mostly from the United Kingdom, Canada, and Australia. It only trails MySpace and Facebook so it is a very powerful entity that will help expand AOL and Time Warner’s reach. For the last few years this company has struggled to find its niche in the Internet while others continue to expand and grow. This also will help with ad revenue and broaden the reach of AOL in countries that they have been wanting to get a greater reach in. With some 57 million people worldwide using AIM and ICQ instant messaging, integrating Bebo into this will be one of the first priorities that they will need to look into. AIM for the longest time has been what AOL has considered their own social network, which in many circles has been a disaster. There really have not been many improvements in this service, so buying Bebo is a natural progression for them.
With Yahoo revamping their Yahoo 360 social network AOL knew they need to do something quickly or they were going to be totally shut out of the social networking juggernaut that everyone has seemed to embrace. This is a big win for Bebo, as their market share will really increase as they now have greater access to the USA. For most people in the United States Bebo is a name that they have really never sought out. Expanding the market reach is something that AOL has lost touch with over the past few years. Reaching a younger crowd is something they have really struggled with. With AOL Journals being a flop, they will hope the powerhouse of Bebo will give them the creditability with the younger twenty something crowd they have not been able to capture.
With the purchase it seems that AOL is now poised to captured a bigger market share—or are they? The biggest downfall that this company runs into is customer service and getting things right. They always seem to jump in after the damage is done, and this could be the same story with Bebo. Instead of being on the cutting edge like other companies do they prefer to stand around and let others build it and then buy it. For the most part it never really works, but Time Warner hopes this time the story comes out differently. You really never know as the social marketing network business can be very fickle and unforgiving, especially if you do things the wrong way. Hopefully AOL has learned from its past mistakes and will not make them again!