AOL "Relaunches" It's $850 Million Social Network, Bebo

Time Warner subsidiary AOL will "relaunch" its third-place social network Bebo today, reports the Wall Street Journal.

In this case "relaunch" means Bebo gets three new features:

* Users can read email and instant messages from third-parties
* Also they can now import feeds from third party sites like Twitter
* A new media recommendation tool that suggests TV shows, music and Web clips already on the site.

People laughed at AOL when it purchased Bebo for $850 million in March. In August, we wrote:

Per TWX's most recent SEC filing, the company is booking almost all of the purchase price -- $760 million -- as goodwill. Another $86 million went to "specific amortizable intangible assets." That is: Beyond $11 million in actual stuff -- servers, Aeron chairs, etc -- there's almost no there there.

So far AOL's having a hard time proving doubters wrong. While Bebo is popular abroad, its 5.9 million US uniques in October were just a fraction of MySpace's 76 million and Facebook's 46 million.

Worse, experimental social network advertising remains largely untrusted by Madision Avenue's clients, who we hear cut it first when budgets get tight as they have recently.

Bebo's plan -- perhaps encapsulated by the media recommendation tool -- is to become an entertainment destination for its users.

"[Entertainment] is a more natural place for you to see an advertisement," Time Warner CEO Jeff Bewkes told the WSJ. "You are used to seeing media with relevant advertising."

"You would have to be stupid -- you would have to trip -- to not succeed at this at some point," Bebo CEO Joanna Shields told the WSJ.