AOL and Bebo have been in talks since September 2007 and it was announced that AOL bought Bebo for $850million today. Investment bank Allen & Co. has been shopping Bebo for some time, major company’s including News Corp., Microsoft and Google, our sources say. Yahoo passed up on the chance to own what is thought of as the 3rd best social networking website in the world behind Myspace and Facebook.

AOL have said that they want to integrate AIM and ICQ properly with social networking. AIM users have 100 buddies on average. Bebo’s platform allows those users to share and distribute media as well.

Current President Joanna Shields (middle in picture) will continue to run Bebo and will report to AOL President Ron Grant (right in picture). Founders Michael Birch and Xochi Birch will shortly be leaving the startup, apparently. Rumor has it, though, that Shields has effectively run the company for some time. Bebo was originally launched in 2005.

Bebo is the second largest social network in the U.K. (its largest market) after Facebook. Recent Comscore data says Bebo has 22 million unique visitors and 11 billion page views; AOL said Bebo users spend an average of 40 minutes a day on the site in a press briefing. The company claims 40 million users.

Bebo does have a lot of Irish users and according to Alexa its the 4th most viewed website in Ireland (At the time of writing) it is also the 115th most viewed website in the world right now.

Bebo, the next generation high school and college social network (like MySpace and Facebook), makes it easy for high school and college students to stay in touch with their friends, find long lost friends, and meet new people. Helpful and fun applications make it easy to remember birthdays, share photos, write blogs, read a friend’s blog, discover new interests, and just hang out. Bebo connects your brand with influencers and their circle of friends.

Bebo has 40 million members worldwide and Time Warner’s AOL internet division is buying the social networking site Bebo for $850m (£417m) which was paid for in cash.

Other social networking sites include:
MySpace
Facebook
Sceneparty
Hi5
Friendster
Orkut

News Corp bought MySpace for $580m in 2005 but now estimates that it is worth more than $15bn, recently Microsoft invested in the phenomenally popular social networking website Facebook which was at the centre of ownership speculation following reports that Microsoft was poised to buy a 5% stake, valuing the site at as much as $10bn (£5bn).

Social networking sites are seen as a valuable location for online advertising, because members post information about themselves and can then be targeted with products and services likely to appeal to them. The transaction comes at a time when Time Warner is considering splitting its business to part company with its AOL unit.

An acquisition of Bebo puts AOL into the hot business of social networking. But while Bebo is very popular in the U.K. and other markets, it remains far behind MySpace and Facebook in both buzz and size of its user base in most of the world.

Bebo was the world’s ninth most popular social networking site in January, according to the internet statistics provider ComScore, which also ranked it as the second most visited in the UK.

It was founded in California by Michael Birch, a British entrepreneur, who still owns a big stake in the business and so will make a great deal from the sale.

A sudden surge or rumors are invading all online outlets in reaction to the Microsoft- Yahoo deal that has caused that news come out from all kind of sources. but something coming from the Times of London should be more plausible to believe one would think, but that is not a sign of truth anymore in a state of hunger for valid news coming from the Microsoft- Yahoo deal after reports broke this weekend that Jerry Yang and the Yahoo board planned to reject Microsfot bid because it undervalues the company.

That is course nonsense, unless they suddenly imagined that yahoo was not a public company anymore and didn`t responded to the market of Wall Street.

Not the truth either, just a common ploy to ask for more money while looking bold and force Microsoft to up the bid. even if they got the bad hand in this game. just a bluff, what works in poker could work for the corporate world, seems to be the mantra in yahoo now.

And from that Report, we come to this rumour that makes no sense at all. no sense at all how they can do a merger when AOL is in transition times that have not been completed.

No sense in it given Yahoo would be the bigger company in a Yahoo -AOL possible merger if we take AOL as a division of a whole (AOL-TW). one that is tied to Google right now because Google does AOL search and own part of AOL, one that is doing acquisitions inside their own web strategy that would become redundant if they were considering the possibility of doing a merger with Yahoo.

AOL movements are a reaction to a world where they could be a number three player after the Microsoft-Yahoo deal is finally done, not movements that give inclination to do a deal like the one this rumour suggests.

All is irrelevant in this time and hour when we are mere moments away from having some news of what plot will unravel in this ongoing story.

Arrington is right, we look for true answers, not bold whimpers or mad men solutions to a company that got a bleak road ahead if this deal don`t comes true.

My opinion is that Microsoft should shot them in the head and post a notification that they are revising the bid and break a rumour that lows the bid to 40-35 billion and input timed conditions into the deal, lets see if after that they still think 44 billion is not enough after their stock crashes.

However Microsoft would opt for other measures i bet and re-enforce the value of the bid, taking the deal directly to shareholders or up the bid a bit and make all of this end for good.

For now, lets await and see.