AOL: Bebo not worth additional investment; Sale or closure coming soon

AOL confirmed today that social networking site Bebo will either be sold or shuttered, a victim of a highly competitive landscape and a parent company that doesn't want to invest to compete. The company will determine its fate by the end of May.

AOL, then part of Time Warner, bought Bebo for $850 million in March 2008, but struggled to build a name for itself outside of the UK, where it's one of the most popular social networking sites. In the U.S., it never really gained any traction. In a memo to employees, the company said:

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

It said that AOL is not in a position to "further fund and support Bebo in pursuing a turnaround in social networking."