AOL (NYSE: TWX) and Bebo bosses hosted reporters and analysts on a conference call to explain the reasons for the $850 million acquisition.
— AOL CEO Randy Falco (left): “This is a tremendous acquisition and one I think is game-changing for AOL – it puts us squarely as a leader in social media. Bebo will be the cornerstone of our strategy to transform the online experience for advertisers, media companies and consumers. … Bebo is the best social media asset out there. It’s a true pioneer in the space, has the most engaged audience on the web and has seen tremendous growth since its founding less than three years ago. When you combine Bebo’s worldwide users with those who use AIM and ICQ, we reach around 80 million… We will be a social media powerhouse. … We will circulate users from Bebo to our network and we will have the opportunity to leverage our scale to grow Bebo’s audience worldwide. It’s not just about throwing more content at more people. It’s about finding new ways to connect users and content … and advertisers.”
— AOL president Ron Grant (right): “We believe it’s a great fit, both the company and it’s people. We’ve been talking to Bebo and Joanna now for about five months… I became more and more impressed with their commitment, passion and vision. Most social networks limit themselves to one dimension – but not Bebo – they’ve redefined social networking and, in the process, have offered a radically new interpretation of … engagement marketing. Bebo will be the centerpiece of our social media offering.” That will include integration with AIM and ICQ instant messaging standards.” User engagement on Bebo is way off the charts compared to competitors and we’re not going to do anything to jeopardize that.
— Uniting AIM, ICQ and Bebo: “There will be no other social network that will have that kind of power attached to it.” A curious rationale since many social nets (including Bebo) already allow users to interact with multiple IM protocols . And who uses ICQ anymore anyway?
— Bebo president Joanna Shields (center): I asked what role English founder Michael Birch and wife Xochi (who are based in San Francisco) will have, Shields said they are “serial entrepreneurs”: “We’ll probably hear more from them in some really exciting venture.” “Can you imagine the success they’ve experienced here today?” “Today we’re here to celebrate their tremendous success.” “We can’t comment on their shares in the company but clearly they’re happy today, I would say.” Sounds like they’ll be earning out of the company after a short while, though no confirmation…
— Will Bebo/Shields stay in London? It’s too early to talk about things like that, she said.
— Confirmation Bebo hadn’t planned to sell: Shields: “We were planning to raise money prior to the interest we received from multiple parties about the business itself, we were going to acquire some small advertising assets, but this was a much better opportunity for us.” She referenced AOL’s contextual advertising, Platform-A and Advertising.com in those opportunities. “We’re looking forward to bringing all those assets to bear.” Shields talked continually about Bebo’s “engagement marketing” strategy (advertisers do product placement in video dramas, broadcasters place shows in its OpenMedia platform, on which users can become “fans” of shows and On advertising: “We only put one ad per page – we’re not a very ad-heavy network.”