AOL has announced this morning that they have acquired social networking service Bebo for $850 million in cash. Bebo has 100 employees operating in offices in the UK, San Francisco and Austin, TX. Bebo is the third-largest social networking service in the U.S. behind MySpace and Facebook.

Indeed, Bebo does make AOL a player in social networking (see Techmeme). Meanwhile, if you couple Bebo with AOL’s ad networks and other initiatives like Open AIM 2.0 Time Warner’s online unit has some mojo.

Let’s add up AOL’s assets:

AOL has spent almost $1 billion on ad acquisitions including ADTECH, buy.at, Lightningcast, Quigo, TACODA and Third Screen Media to create Platform-A.AOL has a lot of inventory through AOL.com, Moviefone, TMZ and Engadget, which is surprisingly never mentioned in Time Warner propoganda.

And now it has Bebo.

Bebo’s assets are clear:

Bebo users view 78 pages a day;Bebo gives AOL some social networking cred;

And Bebo is popular abroad being No. 1 in the U.K., Ireland and New Zealand. In the U.S. it’s the third largest social network behind MySpace and Facebook.

Now it’s up to AOL to do something with Bebo within the bureaucratic structure of parent Time Warner. Another key thread is that the social networking field has narrowed dramatically. AOL has Bebo News Corp. has MySpace and Facebook is in bed with Microsoft, what’s next? are they going to have search engine ranking competition that could help them boost their popularity.

Read more on blogs.zdnet.com by Larry Dignan Editor in Chief of ZDNet

Technorati Tags: Bebo, Network, America Online Inc., Social Networking, Networking, Online Communications, Marketing, Advertising & Promotion, websiteko.com

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