Bebo's British invasion

(Fortune Magazine) -- MySpace and Facebook may dominate the U.S. market, but across the world, a social-networking land grab is underway. A slew of also-rans in the U.S. have attracted some unlikely followings. In Brazil, everyone's on Orkut. In Peru, it's Hi5.com. Philippines: Friendster. The U.K.: Bebo, the hottest site in all the world (that doesn't end in -ace or -ook).

British teens have taken to Bebo with a frenzy once reserved for rock bands and teen heartthrobs. And though the site has been neck and neck with MySpace for the past year, Bebo is starting to pull ahead. In July, Bebo racked up 10.6 million unique page views, according to comScore. MySpace had 10.2 million and Facebook 7.6 million. What's more, Bebo users spend an average of 38 minutes there; MySpace gets 27 minutes.

The American-British Birches

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Started in 2005 by San Francisco programmers Michael and Xochi Birch, the site resembles MySpace - with less mess. Members upload photos, post personal info, and comment on one another's profiles ("omg lol cnt w8!"). The site's privacy controls are some of the tightest online.

Bebo has quickly formed alliances with the big tech companies. On Sept. 12 it announced a partnership with Yahoo (Charts, Fortune 500), which will sell the site's display ads in Britain and Ireland. Yahoo will also integrate Yahoo! Answers with Bebo's site so that users can ask and answer questions and will develop a Bebo toolbar so that they can monitor their profiles whenever they're online.

This follows a recently announced Microsoft (Charts, Fortune 500) partnership that lets members IM with anyone - Bebo friend or not - on Windows Live Messenger.

The site pairs these offerings with provocative media, combining professionally produced entertainment and user-generated content so seamlessly that it's sometimes impossible to tell which is which.

Consider KateModern, an interactive drama for the web. The show's title character, Kate Modern (whose name is a play on the famous British museum, the Tate Modern), is a waifish art student trying to make it in London. She and her friends record and post short video diaries and chat with viewers.

Hokey? Not ready for primetime? Well, young people in Britain are hooked. With seven million viewers, KateModern's audience rivals mainstream TV. The fans watch - and blog, comment, post video, and "friend" their favorite characters - from their profile pages on Bebo.com.

One viewer, Alaina Whiteman, 27, watches every episode and is "friends" with the character Gavin. "It's easy to forget it's a fictional story," says Whiteman. "I also like the fact that it's just on the Bebo; it makes it a bit of a cult thing."

That kind of dedication, of course, appeals to advertisers. Bebo president Joanna Shields, a former Googler, works with companies like Procter & Gamble (Charts, Fortune 500) and Disney (Charts, Fortune 500) to create product-placement sponsorships. The site has partnered with Sony (Charts) for a soon-to-launch second series, Sofia's Diary, which will track a teenager who has begrudgingly moved to London with her family.

Michael Birch, who is British by birth, and his team of 17 engineers keep the site running fast and rely on user feedback to add new elements. Six months before Facebook opened to outside developers, Birch was already working with third parties to help them launch "widgets" - games, slide shows, and various small programs - on the site.

And Bebo has further international ambitions. In addition to building a significant presence in English-speaking countries like Australia and New Zealand, it launched a Polish-language site in August. Similar native-language sites are underway in Italy, Spain, France, and Germany.

Bebo's success hasn't escaped the attention of the Big Two, both of which have global plans of their own. With sites already up in 19 countries plus Latin America, MySpace boasts advertising deals with 80 of the top 100 global advertisers, as ranked by Ad Age. Facebook, which until now has been an English-language-only site, plans to become a multilingual site with lots of country-specific widgets.

And just as threatening are all the entrepreneurs in this nascent industry, from Valley veterans to college kids who have yet to unleash their big ideas.