AOL Groups Social Network Holdings Into Single Unit

AOL completes Bebo acquisition, merges site with other social platforms.

AOL yesterday completed its acquisition of Bebo and said it would group its social networking and messaging properties into a single unit. Called People Networks, the new entity will reach approximately 80 million unique users and be led by Bebo CEO Joanna Shields, the Time Warner unit said.

People Networks combines Bebo, AIM, ICQ, and other community platforms within AOL. It will also integrate other recent acquisitions Goowy Media, a widget technology company, and questions-based community site Yedda.

AOL said the new business unit will provide opportunities for marketers through a blend of services and ad products. To date Bebo has worked with brands including Nike and Apple, and advertisers have integrated messages into the storylines on video series such as “KateModern,” Sofia’s Diary,” and “The Gap Year.”

“People Networks will build on Bebo’s success in creating rich social media experiences that successfully integrate marketing opportunities,” an AOL company spokesperson said.

The monetization of social media through ads has proceeded more slowly than some had hoped. Last week eMarketer lowered its forecast for U.S. online social network ad spending, while PubMatic reported social networking inventory led a recent decline it measured in display ad CPMs. Meanwhile, Google and News Corp., owner of MySpace parent Fox Interactive Media, have separately indicated to investors that they’ve struggled to monetize such inventory to their own satisfaction.

To help it make People Networks more palatable to marketers, AOL recently said it will plans to offer a content screening tool that will use similar technology to the company’s parental controls. The feature will allow advertisers to filter user-generated content on social networking sites to associate content with scores. The screening is expected to give advertisers confidence to make buys on the network.

New EVP and president of the People Networks business unit Joanna Shields has been Bebo’s president for the past 18 months, prior to which she was managing director of Google Europe, Russia, Middle East and Africa. In her new role she’ll travel to multiple AOL offices including London, New York, San Francisco, and Austin.

Content from Bebo will be distributed on several AOL channels, and the social networking platform will integrate music and entertainment content from AOL. Bebo allows media companies to distribute content to its users while retaining all profits from ad revenue. Similarly it allows developers to port their Facebook apps to its platform.

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