AOL to scrap Bebo?

AOL is set to cut its losses on Bebo, admitting it will sell or, more likey, shut the failing the internet social network it purchased for close to $850 million in 2008.

AOL – whose merger with Time Warner is regarded as the worst media deal in history – bought bebo hoping to redefine its future as its business cratered as users deserted to free ISPs. AOL has now been spun-off from TW and is shedding loss makers.

“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,” AOL said in a statement.

Joanna Shields, the former Google exec who as bebo chief did a stellar job of selling it to AOL, has just joined facebook as VP EMEA.