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AOL’s $850 million purchase of Bebo back in March was one of the big social media deals of the year. In a Q&A with ContentNext co-editor Staci Kramer and paidContent:UK Editor Robert Andrews, Ron Grant of AOL (NYSE: AOL) and Bebo’s Joanna Shields (live from London!) discussed the deal, and how the company would fit into the broader AOL.
The Plan: Grant: “There’s a real opportunity to open up these platforms and provide an environment that is very friendly to the user. We’re not trying to to build a destination, but rather lean into the fragmentation of the web.” More specifically, Bebo’s engagement marketing will be melded with AOL’s Platform A, an opportunity made available by the broad reach of the service. He described Bebo as the “final leg of the stool” following the rebuilding of the sites (which has led to an impressive traffic spike) and the establishment of Platform A.
How it’s used: Shields: “In the UK, the 13-24 year olds are watching less and less television… if you’re trying to reach the young demographic, you have to reach them in the language in which they’re interacting with these sites.” Grant touted the redesign of AOL to make the various sites more appealing to youth, which has caused an increase in engagement.
International: Bebo will be a core platform for AOL’s international expansion: “When we think about social networking, we think more about the social anthropological side, and less about the technology and social graph, if you will.” So the challenge is to get the site right for each culture where Bebo is used.
Sponsored content: Robert brought up Bebo’s own sponsored content, and asked whether there were opportunities with Time (NYSE: TWX) Warner’s efforts. Grant was a little unclear on this: “I actually met Joanna at a Time Warner event in London.” He noted that the folks at Time Warner immediately felt that Bebo was a very friendly home for content. Shields “We’re not just chopping up television programs, we’re actually creating content that works in our environment.” And she assured that content creation wouldn’t be a costly albatross: “We don’t launch them until we know they’re going to be profitable… they’re all brand sponsored.” Is there anything lost when Bebo-oriented content goes to TV? Shields: “We’ve moved away from the shaky camera third-person type dramas… the expectation from the users is that they want that professional level of content.”
A home for content: A theme that Shields and Grant kept hitting on: Bebo is designed to be a home for content; unlike Facebook, it’s not designed to be a social communications utility. Between this angle and AOL’s Platform A expertise, the opportunity to monetize the site may be superior than what it’s been at other social nets. Or at least that’s the hope.
Justifying the acquisition: How soon can AOL show a dividend on Bebo? Don’t expect that projection anytime soon. Grant noted that the deal hasn’t closed yet and that Time Warner has given AOL broad leeway to do “what’s right” for the business.
The oddity of Bebo: Robert concluded by pointing out how surreal this discussion was: Bebo was started by someone from England, launched in San Francisco, operated largely in the UK, with an American head, being interviewed today by a Briton in LA.