AOL is ready to give up on UK social networking site Bebo, just two years after acquiring it for $850 million.
The company said Tuesday it “is not in a position at this time to further fund and support Bebo in pursuing a turnaround in social networking,” MSNBCreported.
“As we evaluate our portfolio of brands against our strategy, it is clear that social networking is a space with heavy competition, and where scale defines success. Bebo, unfortunately, is a business that has been declining,” AOL said.
When it acquired Bebo from parent Time-Warner in March 2008 it was one of the largest social networks in Britain, and was ranked first in Ireland and New Zealand and third in the United States, according to AOL.
“Bebo has never had an audience that came close to MySpace and Facebook, except for in the United Kingdom,” Andrew Lipsman, senior director of industry analysis for comScore, told MSNBC.
Bebo had 12.8 million unique visitors in February, according to comScore, a 45% decline from February 2009. Facebook recorded 462 million unique visitors in February, up 68% from a year earlier.
Underlining Bebo’s eclipse, founder Joanna Shields accepted a senior post at Facebook, FT.com reported Wednesday.