For those that doubt the ubiquity of Facebook, one has only to look at the trend emerging in European countries, where home-grown social networks are either being sold or are losing their user base to Facebook. World domination is a slow process, but one that Facebook appears to be making headway across the pond.
Leading Internet service provider AOL recently sold Bebo shortly after purchasing the site in 2008 for 850 million dollars. Rumored reports say that the sale price to investment company Criterion Capital Partners was a fraction of the original cost (some say less than $10 million) but that they unloaded the network because it was not profitable and could not compete against the encroachment of Facebook.
Still popular in the UK, Canada and Australia, since Bebo's new CEO Adam Levin took the helm the site has seen close to 2 million new registered users, putting it at 117 million in October. Though Facebook is the proverbial 800-pound gorilla, Levin says his company "isn't going away."
Leading Dutch social network, Hyves was noted in a TechCrunch report of caving in to the market pressure from Facebook. On November 1, it was announced the the entire company is being sold to Dutch media group TMG (Telegraaf Media Groep) for an undisclosed amount.
Even with a 68 percent market penetration, the owners felt that too many of its users were migrating over to FB. Founded only eight months after Facebook in 2004, Hyves is said to have scaled to 10.6 million member accounts.
In Poland, a similar sale transaction is rumored. Nasza Klasa, the Polish home-grown version of Facebook is said to be on the block for €130 million. With over 27 million users, according to Mike Butcher at TechCrunch, the "figures have been nose-diving this year as Facebook eats into its core social networking user base."
In response to the rumors, the company responded that they are currently "in the hands of private investors, which opens up new opportunities for searching for partners interested in building long-term value of the portal." So while not admitting to the sale, it sounds like the company is open to partnering with others that might know how to better handle its competition with Facebook.
Netlog, which is often described as Europe's answer to MySpace is based in Belgium and targets European and Middle East youth. The have amassed 71 million members. The social media network gathers new friends and users into user feeds by searching through e-mails contacts on various services. While this tool has been used by other sites, it seems to make the friend identification and invite process cumbersome, where Facebook's is more streamlined - obviously leaving an opening for users to consider FB over the smaller network.
News Corporation / MySpaceMedia companies have tried their hand at social networking. The Wall Street Journal even attempted to compete with LinkedIn with a business-oriented site, only to fall short of expectations by its parent company, Rupert Murdoch's News Corporation. For more on their efforts, see my previous post, "Wall Street Gunning For LinkedIn."
The News Corporation's acquisition of MySpace a few years ago looks like its finally making some headway in reshaping the company. But realizing they can no longer compete with Facebook head-on, they have repositioned the company as a "social entertainment destination" focused on music, movies and games for the Y Generation.
While MySpace was the first mover in the social networking space, Mark Zuckerberg and its legions have certainly learned how not only how to overtake its European competition, but also how to compete on a global stage. First stop Europe… perhaps the next stop Southeast Asia!
Satirical graphic novel depicts Facebook's (aka Facebucks) world domination