AOL Seals The Deal On Acquisition Of Bebo

AOL has sealed the deal on its acquisition of the lesser-known social networking site, Bebo.

The deal was first announced in March with a price tag of $850 million, which some thought was a bit short of what Bebo was worth. While the site is a distant third to MySpace and Facebook in the US, it’s number one in the UK, Ireland and New Zealand and has 40 million registered users.

Created by a husband and wife team and launched in January of 2005, the site was relaunched in July of the same year. Many are of the opinion that the acquisition came too quickly. News Corp purchased MySpace in 2005 (around the same time Bebo was relaunching) for $580 million and just three years later the website is worth over $15 billion. Similarly, Facebook rejected a bid of $1 billion from Yahoo! in September of 2006 and is also now valued at over $15 billion. So those who say Bebo could have been sold for more may not be wrong.

Bebo is expected to form the centerpiece of AOL’s newly created People Networks with plans to integrate instant messaging, chat and e-mail into Bebo as well as merging profiles users have on both Bebo and AIM to allow users common screen names for both.

The social networking site has made recent headlines in the UK in connection with what some are dubbing a suicide craze among young people in a small town in South Wales.

In the last year 17 young people from the Welsh town of Bridgend have hung themselves and experts have linked the suicides to Bebo as they fear memorial pages set up for those who have died “romanticise” suicide and that young people see it as a way to become famous.

Read the full story on the Bridgend Suicides here.