Can Michael Birch bring Bebo back?

After selling the company he co-founded in 2008 for $850million, Michael Birch bought it back this year for just $1m - but is it too late to save Bebo?

In 2008 Michael Birch sold Bebo, the social networking site he founded with his wife, Xochi, to the digital media giant AOL for $850m. This July he bought it back for just $1m, promising to reinvent the failing brand. Birch says he never imagined he’d own Bebo again, but when the company he started from his San Francisco living room in 2005 seemed certain to fall into obscurity, he felt compelled to step in.

“It seemed like Bebo’s ultimate fate was that someone was going to buy it and use it as an email list or database to get people to join a completely different product,” he says, when we speak on the phone. “We thought we could give it a happier ending.”

Five years ago, Bebo was the third-largest social networking site, behind Facebook and MySpace, with 40 million users. AOL’s chief executive at the time, Randy Falco, described the acquisition as a “game-changer” for his firm. But by the late Noughties, users of social networking sites were defecting to Facebook in huge numbers.

In 2010, AOL offloaded Bebo for $10m to the private-equity firm Criterion Capital Partners, which couldn’t halt the site’s decline. In March 2013, Facebook had 1.11 billion monthly users while, Birch tells me, only a “couple of hundred thousand” sign into Bebo every month.

Birch, who is 43, was born in Hertfordshire and met Xochi while they were both studying at Imperial College London. He says he ended up in San Francisco only “by chance” because Xochi grew up there. Where social media stars such as Facebook’s founder, Mark Zuckerberg, and Twitter’s founder, Jack Dorsey, talk in lofty terms about how their inventions have changed the world, Birch has retained a stereotypically British irreverence. He has posted a spoof product video for Bebo’s relaunch, in which he explains over dramatic background music how Bebo empowered millions to share “potentially career-destroying photos” and how its online doodling feature turned the site into the “single biggest repository of illustrated cock-and-balls ever recorded”.

Birch believes that Bebo’s decline, far from confirming Facebook’s strength, has exposed its fundamental weakness. He learned that “you grow and become very large because of the networking effect, but it can also be your demise because when people start leaving, it tends to be the early adopters and the influencers who go first and they take their friends with them.” He says that Facebook, which floated in 2012, is “overvalued” and can’t maintain its market dominance. Expecting someone to stay on Facebook is like “saying someone is only going to go to one bar for the rest of their life”.

The new Bebo will be a mobile-only app and it won’t compete directly with Facebook. This is partly because Birch believes Facebook’s model is becoming outdated. Having studied his 14-year-old daughter’s online habits, he thinks people will increasingly sign up to several social media apps, and that they will go for more direct, personalised forms of online communication.

Running Bebo will be harder now he’s in his forties, Birch says. He has three children and has lost the “hunger” needed to work 80-hour weeks. As the young tech billionaires who made it big in the Noughties start to approach middle age, they share one common enemy.

“It doesn’t matter how successful or wealthy you are, the people you are most fearful of are the young, up-andcoming people,” he says. “If you ask Google who they are most fearful of, it’s probably the guy in his dorm room, not the big companies of the world.”

While Facebook had over 1.10 billion users in March 2013, Bebo is down to a "couple of hundred thousand". Photograph: AFP/Getty Images.

Sophie McBain is a freelance writer based in Cairo. She was previously an assistant editor at the New Statesman.

This article first appeared in the 17 October 2013 issue of the New Statesman, The Austerity Pope

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Why Barack Obama was right to release Chelsea Manning

A Presidential act of mercy is good for Manning, but also for the US.

In early 2010, a young US military intelligence analyst on an army base near Baghdad slipped a Lady Gaga CD into a computer and sang along to the music. In fact, the soldier's apparently upbeat mood hid two facts. 

First, the soldier later known as Chelsea Manning was completely alienated from army culture, and the callous way she believed it treated civilians in Iraq. And second, she was quietly erasing the music on her CDs and replacing it with files holding explosive military data, which she would release to the world via Wikileaks. 

To some, Manning is a free speech hero. To others, she is a traitor. President Barack Obama’s decision to commute her 35-year sentence before leaving office has been blasted as “outrageous” by leading Republican Paul Ryan. Other Republican critics argue Obama is rewarding an act that endangered the lives of soldiers and intelligence operatives while giving ammunition to Russia. 

They have a point. Liberals banging the drum against Russia’s leak offensive during the US election cannot simultaneously argue leaks are inherently good. 

But even if you think Manning was deeply misguided in her use of Lady Gaga CDs, there are strong reasons why we should celebrate her release. 

1. She was not judged on the public interest

Manning was motivated by what she believed to be human rights abuses in Iraq, but her public interest defence has never been tested. 

The leaks were undoubtedly of public interest. As Manning said in the podcast she recorded with Amnesty International: “When we made mistakes, planning operations, innocent people died.” 

Thanks to Manning’s leak, we also know about the Vatican hiding sex abuse scandals in Ireland, plus the UK promising to protect US interests during the Chilcot Inquiry. 

In countries such as Germany, Canada and Denmark, whistle blowers in sensitive areas can use a public interest defence. In the US, however, such a defence does not exist – meaning it is impossible for Manning to legally argue her actions were in the public good. 

2. She was deemed worse than rapists and murderers

Her sentence was out of proportion to her crime. Compare her 35-year sentence to that received by William Millay, a young police officer, also in 2013. Caught in the act of trying to sell classified documents to someone he believed was a Russian intelligence officer, he was given 16 years

According to Amnesty International: “Manning’s sentence was much longer than other members of the military convicted of charges such as murder, rape and war crimes, as well as any others who were convicted of leaking classified materials to the public.”

3. Her time in jail was particularly miserable 

Manning’s conditions in jail do nothing to dispel the idea she has been treated extraordinarily harshly. When initially placed in solitary confinement, she needed permission to do anything in her cell, even walking around to exercise. 

When she requested treatment for her gender dysphoria, the military prison’s initial response was a blanket refusal – despite the fact many civilian prisons accept the idea that trans inmates are entitled to hormones. Manning has attempted suicide several times. She finally received permission to receive gender transition surgery in 2016 after a hunger strike

4. Julian Assange can stop acting like a martyr

Internationally, Manning’s continued incarceration was likely to do more harm than good. She has said she is sorry “for hurting the US”. Her worldwide following has turned her into an icon of US hypocrisy on free speech.

Then there's the fact Wikileaks said its founder Julian Assange would agree to be extradited to the US if Manning was released. Now that Manning is months away from freedom, his excuses for staying in the Equadorian London Embassy to avoid Swedish rape allegations are somewhat feebler.  

As for the President - under whose watch Manning was prosecuted - he may be leaving his office with his legacy in peril, but with one stroke of his pen, he has changed a life. Manning, now 29, could have expected to leave prison in her late 50s. Instead, she'll be free before her 30th birthday. And perhaps the Equadorian ambassador will finally get his room back. 

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.