Inside The Deals: AOL May Be Worth More Than You Think

Long-suffering AOL may be worth more than some investors think. Last fall, UBS analyst Mark Morris pegged the value of Time Warner’s AOL unit at $13 billion, a mere 2.5 times revenue. That pessimistic view reflects AOL’s declining revenue, which fell 33 percent last year to $5.2 billion. A lot has changed during the last few months. Oh, AOL’s revenue still is on the decline. But Microsoft’s offer to buy Yahoo for $42 billion has pressured its rivals. That bid, currently worth about six times Yahoo revenue, shows that even mature Internet companies have plenty of appeal to the right strategic buyer. (PaidContent)

AOL acquires Bebo social network

Time Warner's AOL internet division is buying the social networking site Bebo for $850m (£417m) in cash. Bebo is the third-biggest social networking site in the US, behind MySpace and Facebook. The price-tag is tiny when compared with the valuations of similar websites. Microsoft bought 1.6% of Facebook last year for $240m. (BBC News, PR, Financial Times)

Chief of AOL’s Parent Is Open to Deal

Jeffrey L. Bewkes, the chief executive of Time Warner, AOL’s parent company, acknowledged weakness in the business and said he was open to combining AOL with another company — “whatever configuration makes it the strongest and the most valuable.” But he may have been soft-pedaling what seems to be an increasingly troublesome situation at AOL, which has bet its future on a new strategy of selling advertising across the Internet and has spent more than $1 billion on related acquisitions. (NY Times)

CBS Radio Signs Exclusive Agreement to Power AOL Radio

CBS RADIO and AOL today announced a ground breaking partnership whereby CBS RADIO will power AOL Radio (http://radio.aol.com), combining two of the largest online radio networks and giving millions of listeners unlimited and free access to the most diverse lineup of programming available. Additionally, the two companies will work together to create a number of product enhancements including a new player, as well as complete support for the Mac. (PR)

Yahoo Looks at New Way to Survive

Microsoft, whose offer for Yahoo is now worth $41.2 billion, was preparing to escalate its takeover fight by starting a proxy contest. But in an effort to delay that move, Yahoo is considering several options, including a plan to postpone its annual meeting, people close to the company said on Tuesday. The maneuver comes as Yahoo has stepped up merger and joint venture talks with AOL, a unit of Time Warner, these people said. (NY Times)

Tech Firms Respond To McGuinness Blast

Following the speech, a handful of tech firms and ISPs distanced themselves from illegal file distribution. AOL executives stressed that their company stood for legal music, and always took "prompt action" against users uploading illicit content on its service. Mario Mariani, CEO of Tiscali Italia, came out in support of McGuinness's calls for greater cross-sector co-operation. Apple and HP were among the technology firms contacted who declined to give comment to Billboard. (Billboard)