Hitwise Intelligence - Heather Dougherty - US
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March 13, 2008
AOL snags Bebo for $850 million
Another social network has been purchased, during this round, Time Warner’s AOL unit has acquired Bebo for $850 million. The social networking category has been a continued area of interest, particularly among media and technology companies hoping to take advantage of one of the Internet’s most popular communication vehicles to boost advertising inventory. Some of the previous acquisition and investment activity in the space has included News Corp.’s acquisition of MySpace. in July 2005 for $580 million and Microsoft purchased a stake in Facebook in October of last year.
So why Bebo? In February 2008, Bebo ranked 4th among a custom category of 51 social networks, after MySpace, Facebook and MyYearbook, receiving 1.15% of all U.S. visits to the category. In the U.S., Bebo is a smaller player when compared to both MySpace and Facebook – among all categories, MySpace's share of U.S. Internet visits was 67 times larger compared with Bebo and Facebook's share of US Internet visits (was 11x that of Bebo) in February 2008. However, in the UK, Bebo ranked 2nd among Social Networking websites and is the most searched-for brand, ahead of both eBay and Facebook, highlighting the strong brand equity in the market.
The average time spent on Bebo in February 2008, was 30 minutes and 26 seconds, below MyYearbook (31 minutes and 35 seconds) and more than both MySpace (30 minutes, 7 seconds) and Facebook (21 minutes). The average time spent on Bebo remained consistent year-over-year, while MySpace is slightly down, while the time spent on MyYearbook and Facebook increased, up 119% and 69%, respectively.
Many of the users are moving back and forth between other social networks, maintaining multiple accounts. In February 2008, 34% of the upstream traffic came from the Social Networking & Forums category and 33% of Bebo’s downstream traffic visited another website within the Social Networking category. MySpace was the most significant driver of traffic, representing 21% of the traffic being driven to Bebo and Facebook was responsible for an additional 4%.
Even with the cross-traffic between other social networks, Bebo is retaining a significant share of their user base, with 83% of upstream traffic from returning visitors (defined as those that have visited the website within 30 days) in February 2008. Bebo also attracted new visitors, which represented 17% of their traffic. Currently, search is a strong acquisition channel of new users for Bebo, 21% of the total upstream traffic was referred from Search Engines and of those visitors, 38% were new.
This announcement is timed nicely with the South-by-Southwest conference. Bebo & Music Nation partnered up for a music contest called “Bebo OnStage”, where unsigned artists and bands competed against each other and let the community choose the winner. The prize will be an opportunity to perform at the conference, currently being held in Austin, Texas and a record contract with Original Signal/Epic Records.
Posted by Heather Dougherty at 01:20 PM
Posted to Social Networking
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