Social Networking Becoming more Invisible But More Ubiquitous?

The Economist notes that while social networking efforts haven’t found profitable financial models, there is evidence that they are migrating to more of a common model that is less proprietary and more in the background, like air.

“Historically, online media tend to start this way. The early services, such as CompuServe, Prodigy or AOL, began as ‘walled gardens’ before they opened up to become websites. The early e-mail services could send messages only within their own walls (rather as Facebook’s messaging does today). Instant-messaging, too, started closed, but is gradually opening up. In social networking, this evolution is just beginning. Parts of the industry are collaborating in a ‘data portability workgroup’ to let people move their friend lists and other information around the web. Others are pushing OpenID, a plan to create a single, federated sign-on system that people can use across many sites.

“The opening of social networks may now accelerate thanks to that older next big thing, web-mail. As a technology, mail has come to seem rather old-fashioned. But Google, Yahoo!, Microsoft and other firms are now discovering that they may already have the ideal infrastructure for social networking in the form of the address books, in-boxes and calendars of their users. ‘E-mail in the wider sense is the most important social network,’ says David Ascher, who manages Thunderbird, a cutting-edge open-source e-mail application, for the Mozilla Foundation, which also oversees the popular Firefox web browser.

“That is because the extended in-box contains invaluable and dynamically updated information about human connections. On Facebook, a social graph notoriously deteriorates after the initial thrill of finding old friends from school wears off. By contrast, an e-mail account has access to the entire address book and can infer information from the frequency and intensity of contact as it occurs. Joe gets e-mails from Jack and Jane, but opens only Jane’s; Joe has Jane in his calendar tomorrow, and is instant-messaging with her right now; Joe tagged Jack ‘work only’; in his address book. Perhaps Joe’s party photos should be visible to Jane, but not Jack.

“This kind of social intelligence can be applied across many services on the open web. Better yet, if there is no pressure to make a business out of it, it can remain intimate and discreet. Facebook has an economic incentive to publish ever more data about its users, says Mr Ascher, whereas Thunderbird, which is an open-source project, can let users minimize what they share. Social networking may end up being everywhere, and yet nowhere.”

socialcapital.wordpress.com

AOL/Bebo Buy Could Create Second-Largest Social Platform

In a move that should help them secure a bigger slice of the social networking world, AOL has entered into an agreement to purchase social platform Bebo. The social platform boasts 40 million unique users worldwide; once joined with AOL's AIM and ICQ systems AOL that number will grow to 80 million uniques.

With 80 million unique users, the AOL/Bebo baby will be larger than Facebook (67 million uniques) but still smaller than MySpace.

What exactly is AOL getting?

According to comScore, Bebo is one of the fastest growing social networks with 688% growth from January 2007 to January 2008. Facebook showed only 11% growth and MySpace 8% growth during the same period. Though their total unique users are much fewer than MySpace or Facebook, Bebo users spend more time in the social space. Bebo users spent 217 minutes in the social space in January while Facebook users spent 198 minutes and MySpace users spent only 156 minutes.

HitWise found that Bebo was the fourth most popular social platform following MySpace, Facebook and MyYearbook in February 2008. More than 80% of Bebo traffic for February was return traffic. In the UK, Bebo is the brand most searched for, leading both Ebay and Facebook.

Looking ahead into 2008, Bebo has plans to launch social platforms in France, Germany, Italy, the Netherlands and Spain. AOL, also, has announced plans to spread their social wings a bit more with some reporting that the company plans to expand into 30 more countries by 2009.


by Kristina Knight
bizreport.com

AOL buys social network Bebo for $850 million

In an unexpected move, AOL has acquired social-networking site Bebo. The price tag: $850 million in cash.

Rumors had floated over the past few months that Bebo, which has over 40 million members, was up for sale. Reports suggested a $1 billion price tag, but there were few hints as to potential buyers. Though Bebo had already partnered with AOL's AIM messaging client to facilitate friend-invite interoperability between the two services, even the most creative blogger speculation didn't seem to point to AOL eventually buying the social network.

Ironically, AOL itself has been talked about as an acquisition target. Jeffrey Bewkes, CEO of Time Warner, which operates AOL, has spoken recently about plans to spin off or sell divisions of the company.

AOL has made it clear that buying Bebo is a move geared toward international growth, as the youth-oriented social network is wildly popular in the U.K., Ireland, and New Zealand. AOL reported that it has launched "17 international web sites over the last year and has plans to expand to 30 countries outside the U.S. by the end of 2008," as well as international versions of its home page and some services. Bebo, meanwhile, plans to launch five localized versions of its service this year (France, Germany, Italy, Spain, and the Netherlands), and AOL will make it a major part of the company's international expansion strategy.

"Bebo is the perfect complement to AOL's personal communications network and puts us in a leading position in social media," said AOL chairman and CEO Randy Falco in a statement. "What drew us to Bebo was its substantial and fast-growing worldwide user-base, its vision of a truly social web, and the monetization opportunities...This positions us to offer advertisers even greater reach and marketers significant insights into the desires and needs of consumers."

Additionally, despite the fact that performance monitoring firms have pegged it as sluggish, Bebo's technology was likely appealing to AOL. The social network's developer platform supports both OpenSocial and Facebook applications; it also has an "Open Media" platform for audio and video content from big-media names like CBS and MTV as well as online production outlets like Next New Networks and Ustream. AOL, meanwhile, has opened up AIM to developers.

In a conference call on Thursday, Falco and Ron Grant, AOL's president and COO, as well as Bebo president Joanna Shields, said that integration between Bebo and AOL's AIM and ICQ messaging properties will be crucial. Combined, they said, AOL will own a "social graph" of 80 million people, bigger than the 67 million that the independently-run Facebook currently counts but still significantly smaller than News Corp.'s MySpace.com.

"The distribution aspect of linking up with AIM and ICQ is an extraordinary opportunity for us," Shields said in the conference call.

Still, at the core, the Bebo acquisition is all about the advertising. It comes at a time when AOL is still struggling to make the transition to a leader in online advertising after amassing nearly $1 billion worth in acquisitions--Tacoda, Buy.at, Quigo, and AdTech, to name a few--into its Platform-A ad network, as well as social-media buys like Goowy. Bebo, like most other social-networking sites, relies on ad revenue, and as projections claim that social-media ad buys will keep rising (eMarketer predicts 75 percent year over year), AOL undoubtedly wants a piece of the pie.

But it's still an uphill climb for AOL. Just this week, the company confirmed that Platform-A president Curt Viebranz was departing the company amid a management shakeup.

Joanna Shields, president of the San Francisco-based Bebo, will continue to run the social network and will report to Ron Grant. The deal was brokered on AOL's side by Bank of America Securities and Deutsche Bank Securities. Bebo had hired investment bank Allen & Co. when it opted to put itself up for sale.

Grant estimated in Thursday's conference call that the deal will ideally be complete within a month.