News

Bebo To Add IM Powered by Microsoft

• By The Associated Press
• August 21, 2007

The deal signals early, if niche, support for a Microsoft Corp. plan to build a business around letting other sites incorporate its Windows Live Web services.

The Bebo-branded IM will have limited compatibility with Microsoft's own services, consistent with a tendency for social-networking sites to build "walled" communities with restrictions on who can contact whom and how elsewhere online. IM services also have tended to operate independently, although those walls have started to come down.

Bebo members will be able to click a link to start an IM session with any other Bebo member, even if neither has a Windows Live ID, the sign-on used for Hotmail and other Microsoft services.

They'll also be able to exchange messages with Bebo friends who aren't logged on, but who are using Microsoft's regular Windows Live Messenger program.

However, Bebo users will not be able to send instant messages to Windows Live Messenger users who don't have Bebo accounts, and Windows Live Messenger users won't be able to see if their buddies are logged on to Bebo.

Bebo said it will provide a way for its users to get a Windows Live ID; Microsoft said it will not promote Bebo to its own users.

The social networking site also plans to incorporate Microsoft's address book management tools. Specifics about how the new features will look are still being worked out, Bebo said.

The two companies declined to discuss financial terms of the deal.

San Francisco-based Bebo trails News Corp.'s MySpace and Facebook in usage, but it is particularly strong in Europe, where the company plans to expand to six new countries including France and Germany, according to Joanna Shields, the company's president of international business.

"The partnership, for us, gives us an opportunity to expand more rapidly into more European markets," Shields said, saying Bebo could piggyback on what she calls Windows Live Messenger's dominance in the region.

Shields also said the IM program will benefit Bebo members.

"Why have two windows open when you can do everything in one environment?" she said. The startup also lets its members connect using eBay Inc.'s Skype Internet calling, but requires them to download Skype software first.

So far, takers for Microsoft's Web services platform include Match.com, a dating site owned by IAC/InterActiveCorp, and MSNBC, a joint venture between Microsoft and General Electric Co.'s NBC Universal, but the software maker said it is seeking out more social-networking customers.

Microsoft spokesman Adam Sohn said it makes sense to let the software maker do this high-tech heavy lifting for smaller startups, giving them more time to focus on other aspects of the business.

"Bebo's not going to win against Facebook, LinkedIn and everybody else because they have a better contact-management solution," he said.

Bebo may not be the top player in its field, but that isn't the best measure of the strategy's success, said Michael Gartenberg, an analyst at Jupiter Research.

"What's really important is how quickly there's a follow-on," he said. "It's one of those things where, really, success breeds success."