Posts Tagged ‘bebo’

Zynga pulls Mafia Wars from MySpace

Wednesday, April 20th, 2011

MySpace.  A stellar example of what can go drastically wrong when you’re sitting pretty at the top.  While the flailing social network has seen it’s fair share of blows, it would appear that just another nail in the coffin has recently been stuck.  According to notice posted on the game’s MySpace home, Zynga has pulled the plug on MySpace, and is now sending players to Zynga’s own; further evidence that the social games maker would like to become less and less dependent on social networks in general.  With that said, Zynga is still relying on Facebook Connect from their own platform.

Significant in it’s own right, this move has particular meaning, as Mafia Wars had been the second most popular game on MySpace as recently as March, according to an Inside Social Games report, counting a healthy 13 million players of the title on MySpace.  Granted, these figures do not include regularly playing members, but still a grande number.

Zynga’s stand-alone title, Zynga Poker is still available on MySpace, however YoVille and Fashion Wars have already quietly exited the platform, while Zynga’s big guns, CityVille and FarmVille have never been available to MySpace users.

So in addition to Zynga’s push to pull users off the social space and bring them home to their own platform, various sources including TechCrunch are speculating that Zynga is simply beating a dead horse by continuing to put time, money, and effort into a sinking ship, i.e. MySpace.

According to a March ComScore report, MySpace’s numbers are in freefall, dropping from 93 million unique users to 63 million over the course of a year.  It would also appear that the MySpace exodus is accelerating, with 10 million monthly users saying sayonara between January and February.

This move by Zynga flies directly in the face of MySpace’s goals, as just last year, the platform took on a Hi5-esque role, shifting their focus from social network to social gaming destination, with little to no success.  Adding insult to injury, just 5 short months later, Zynga was able to attract and hire MySpace CEO Owen Van Natta.  And then there’s that massive layoff this past January, which saw approximately 600 employees let go.

So with the walls crumbling around them, the question remains; what does the future hold for News Corp. owned MySpace?  Remember, the firm paid a massive $580 million for MySpace back in 2006, but can still be seen as a bargain when compared to AOL’s $850 million purchase of Bebo.  So when seen in this light, perhaps a tax write off would make more sense?


Bebo. AOL’s $850 million mistake.

Friday, June 18th, 2010

Well, it looks like it took slightly longer than initial estimates, but AOL has finally unloaded sold social networking, ummm, platform for a massive (just under) $10 million. That’s $840 million less than they paid for it. No, that’s not a typo. Eight hundred and forty million dollars. Gone. Down the drain. Ouch.

bebonoes!But let’s take a stop back a few years, when AOL was trumpeting it’s own horns on the successful acquisition of Bebo, a one-time Facebook competitor. The idea was to use Bebo as a springboard for all future AOL social networking activities. Admittedly, a sound strategy and solid business idea.

Founded in 2002 by Michael Birch and is wife Xochi, Bebo (which is a moniker for Blog Early, Blog Often) started to see the light in early 2005. It soon started taking off, and at one point was garnering more traffic than Amazon; If you’re looking solely at British analytics. At the time of purchase, AOL had some serious expansionism in mind, and figured that under their banner, Bebo could duplicate the same success on American shores (same language, right?). In 2008, AOL took the plunge and signed on the dotted line to take over control of Bebo. Arguably, Mr. and Mrs. Birch made the deal of the decade.

And while the initial response was positive, Bebo, just like many other competitors to Facebook began the slow decent into the abyss. Between the time of purchase (February 2008) and this past March, over 10 million users have abandoned their Bebo accounts.

Noteworthy; because AOL sold Bebo for such a minuscule amount in comparison to what they paid for it, they weren’t legally required to report it – and at first, they didn’t. Bebo’s new owners Criterion Capital Partners, issued a press release, and it wasn’t until persistent media inquiries finally broke down the wall of AOL shame silence.

AOL CEO Tim Armstrong comments, “Criterion Capital Partners are specialists in facilitating growth plans and turnarounds, and well placed to drive Bebo’s effort to strengthen its foothold within the highly competitive social networking arena.”

Un huh.

And now for one of the best parts of the entire fiasco: Due to the complexities of US corporate tax laws, because AOL sold Bebo for less than $10 million, they’ll be able to use the sale as a write off. Judging by standard corporate tax rates, AOL stands to gain in the neighborhood of $300 million in tax credits, plus the $10 million it picked up from Criterian. Not quite the price they paid for it, but a heckuva lot better than whipping a dead horse.

Now don’t get me wrong, I have no feelings either way towards Bebo. I think I opened an account there sometime back in the oughts, but never really did anything with it. Criterion Capital may have just made the purchase of the millennium, because if there’s anything to learn from social networks that aren’t Facebook, is that they can come back in many different forms. Hi5 is a prime example of this mechanism at work.

Adam Levin, a managing partner at Criterion Capital Partners agrees, “The young, highly active user base, revenue history, presence in countries throughout the world and solid technical infrastructure make it [Bebo] an attractive media platform both as a standalone entity and in the context of our broader investment objectives.”


Bebo to Begone by May’s end

Friday, April 9th, 2010

One look at AOL’s share prices over the pat few days indicate that investors are willing (looking forward to?) to letting the social network Bebo go the way of the Dodo. Announced on Tuesday of this week, the following day, AOL’s shares surged to a price they haven’t seen since it’s November spinoff, rising almost 4 percent to close at $27.44

fail-boatThere’s a couple of things going on here that have lead to Bebo’s epic fail. First and foremost, AOL executives obviously have their collective heads up their ass, as they clearly weren’t able to learn a thing from News Corp’s purchase of AOL shelled out a massive $850 million to Joanna Shields of Bebo in 2008, hoping to corner the marketing on UK teen girls.

All of these girls are now, of course, are on Facebook.

The official memo that was distributed to employees states that, “Bebo, unfortunately, is a business that has been declining and, as a result, would require significant investment in order to compete in the competitive social networking space.”

Read: Bebo is a money pit, and we’re not going to sink another dime into it.

While AOL states that they are looking for a buyer for the ailing social network, they’ve also publically stated that a shutdown might allow them to write down some of the acquisitions costs, thereby yielding hundred of millions of dollars in tax savings. 3 guesses, the first 2 don’t count; which option to you think AOL is going to go with here? AOL has also stated that they’ve set a final hour of the end of May to either find a buyer, or they’ll pull the plug. Friendster anyone?

While based in San Francisco, Bebo never really gained traction in the US, but had, at one point, a strong user base in the UK. They got into the virtual goods market last year as part of a promotion for their Bebo Mobile service. And like many other social networking services, Bebo is a host for social gaming apps including titles from Zynga.

The sale of Bebo isn’t the only “Hmmm…maybe that wasn’t the smartest use of capital we’ve ever made,” issue going on at AOL. They’re also working on selling off the ICQ IM business, most likely to a foreign investor. This sale has been moving at a the pace of molasses, but once if completed, could net the company between $100 – $150 million in cash.

This pile of plunder could give CEO Tim Armstrong a nice position to sit in at the Google and Microsoft table when negotiations commence over a new deal for AOL’s search business. The Google deal is set to expire in December.


Playfish nets over 100 million installs

Thursday, July 2nd, 2009

London based social games company, Playfish, announced yesterday that they’ve officially crossed the 100 million installs milestone.  These 100 million installs are comprised of the company’s seven different games offerings, and has been achieved in an astonishing 18 months.

playfish_blueTo name a few, Playfish is the provider of social games such as Pet Society, Restaurant City, Minigolf Party, and Bowling Buddies.  Playfish games are most often played across popular social networks, primarily facebook, bebo, and the other one MySpace.

“Social games are bringing a fundamental shift to video games – away from a single player-focused activity to one in which people play with their real-life friends,” says Atul Bagga, vice president, gaming research for ThinkEquity. “By putting the emphasis on interaction between friends, social games have expanded the potential reach beyond traditional video games to an entirely new, non-gaming audience.”

In their official release, Playfish goes on to point out that they’ve been able to accomplish in 18 months, what two gaming classics have taken 45 years and 8 years to accomplish.  The first, perhaps the most well known game in history, Monopoly took approximately 45 years to attract 100 million players, while the best selling PC game of all time, and third most popular video game series globally, the Sims, took 8 years to achieve this number.  Fair points folks, but I think you also need to look at the delivery mechanism.  Playfish is providing games for free across a readily, almost instantly available mechanism.  They’re also comparing a collective number, seven games offerings, against one singular game.  So while I’m not going to say that 100 million installations isn’t something to celebrate, I’m also not quite sure Playfish should ready to be put themselves in the same category as Monopoly and the Sims.

With that said, Playfish is undoubtedly raking in some seriously impressive numbers.  They currently count over 30 million active monthly users across their portfolio of games offerings, each of which has been in the facebook top 10 at one point or another.  Playfish’s flagship, Pet Society is played by 12 million people every month, and their newest offering Restaurant City, has seen over 5 million players since launching only 10 weeks prior.

“When we founded Playfish, our goal was to change the way the world plays games by creating experiences that are social and connected between friends,” says Kristian Segerstrale, CEO and Co-founder of Playfish. “Reaching 100 million installs in such a short time is clear proof of social gaming’s popularity and how loyal, enthusiastic and deeply engaged the Playfish community is.”


Piczo calls it a day, joins forces with Stardoll

Monday, March 9th, 2009

San Francisco based teen social network Piczo looks as though they’ve called it a day with trying to make it on their own, and will be joining the Stockholm, Sweden based teen-girl dress-up site StardollPaid Content UK reports that Piczo will remain independent, however together with Stardoll, they are forming “The Stardoll Network”.  This new network will also include a third member, Paperdoll Heaven (A free title, ad supported).

stardoll1While mainly photo sharing based Piczo claims over 30 million registered users, with 10 million monthly unique views, they’re still a relative ‘unknown’ in the social networking scene.  Part of this low profile stems from the sites’ user base itself – a demographic comprised mainly of 13 – 16 year olds.  In comparison, larger social networking sites such as Facebook, MySpace, and Bebo have an average user age significantly higher.

Stardoll shares a similar story, while flying well below the ‘grown-ups’ radar, the site has been a hit with it’s not always easy to please target audience: teenage girls.  Stardoll currently reports 27 million accounts, and not only allows users to naturally dress up dolls in any way they wish, but have also been courting pop stars to create their own alter-egos.

The third member of the Stardoll Network is Paperdoll Heaven, launched last December.  The name was the original name for Stardoll itself when it launched in 2004.

What is particularly noteworthy about the newly formed Stardoll Network is that they’ve truly got a mixed bag here.  It looks as though the Network is placing one of the big three monetization modules in each child site.  Stardoll includes microtransactions, Piczo includes a ‘Piczo Plus’ option (subscription), and Paperdoll Heaven will be free via ad-support.

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RockYou – on track to be on top

Wednesday, November 12th, 2008

Virtual Reality Social Games Worlds Networks can at times be busier than Grand Central at 5:09 on the Wednesday before Thanksgiving.  There are lots of players, each with their own unique take and slice on their specific niche.  And while playfish has certainly made a lot of noise over the past few weeks, it’s often the guys in the back of the room that you’ve got to look out for.  RockYou, please step forward.

RockYou is a self described, “innovator, creator, and distributor of widgets and applications on the social web.”  Try saying that one 5 times fast.  In other words, RockYou creates a lot of those cool widgets and apps that are served up daily every time you log in to your facebook account.  RockYou is the creator of popular apps including SuperWall, SuperPets, Likeness, and HugMe while their widget stable includes Slideshows and Corkboard.  Sound familiar, chances are you’ve used one or RockYou’s apps recently?   They also made waves back in July with the purchase of popular apps Speed Racing and Pieces of Flair.  According to, at the time of acquisition #11 app Pieces of Flair was clocking 475,000 daily users, and # 27 Speed Racing weighing in with 200,000 users per day.’s Top MySpace games for September 24, 2008 places 2 of the top 12 belonging to RockYou, and they consistently rank high on the Facebook Most Active Users directory (Superwall, Hugme, Pieces of Flare, Likeness, and Birthday Cards all ranking in the top 28).

In addition, RockYou also specializes in creating customized branding and marketing solutions that reach consumers in a medium that the feel comfortable with and used to via applications.  They’ve developed applications for any social network including Hi5, MySpace, Bebo, Facebook, Bebo, and Friendster.  Reaching the masses via advertisement through entertainment is nothing new, but few companies are able to do it as well as RockYou.

There has been a bit of confusion regarding just what slice of the social networking pie RockYou is after, as CEO Lance Tokuda was quoted as saying “ We want to be like the Electronic Arts of social networks, and build games for social networks,” at the Startonomics conference in San Francisco in the beginning of October.  While at the same time Brett Errill reported over at his blog that RockYou is still focusing its efforts on their ad network.

Whether Tokuda’s statement was taken out of context or not, I say: Does it matter?  With monetization models popping up all over the place, along with Google’s own entry into the game monetization via advertising, the way I see it, RockYou is already leaps and bounds ahead of their competitors.  With highly popular widgets and applications perfectly positioned in front of users of some of the world’s highest trafficked websites, along with the already existing ad network specialty, RockYou is well on track to becoming a mighty force to be reckoned with.

Find out more about RockYou by visiting them at

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