SUP to Acquire LiveJournal

Russian online media company SUP has announced its decision to buy LiveJournal, a social networking and blogging site. SUP has apparently reached a deal with Six Apart, the company that owns LiveJournal, though no financial details regarding the deal are available so far.

For those watching developments on this front, the deal would seem to be a logical conclusion, considering that SUP already had in place a licensing deal with Six Apart that allowed it to manage LiveJournal’s Russian part – LiveJournal.ru. LiveJournal is exceedingly popular in Russia, boasting of a 28 percent share of the audience there. This is a major number, even given the fact that the site has its maximum users from the US.

Social networking sites have been targets of a number of deals in the recent past. The trend for this was set way back in 2005, when the News Corporation acquired MySpace for a cool $580 million. The value of the site shot upwards as its popularity increased and ever since, media companies have looked on social networking sites as good business propositions.

That the value of social networking sites has been on the ascendance is also borne out by the battle between Microsoft and Google for a stake in FaceBook, another popular social networking website. At the end of it all, Microsoft dished out $240 million for a 1.6 percent stake.

While Facebook and the others belong to a newer generation of social networking sites, LiveJournal is part of the old guard. Founded in 1999, the site became popular as a location where users could post entries similar to the way they would in a journal; hence the name. Users also had control over who saw their entries.

From those small beginnings, LiveJournal today has grown to such heights that it boasts of 18 million unique visitors each month. Today, the site also has a number of communities, each of them focused on a different aspect of life – fashion, television, food, etc. The site mostly has young users, within the age group of 15 to 22 years, of which two-thirds are female.

According to the basic terms of the deal between SUP and Six Apart, all operations of the social networking site would be run by LiveJournal Inc., an American management company created by SUP. Also on the anvil is the formation of an advisory board that would have as its member Brad Fitzpatrick, the founder of LiveJournal who currently is working with Google.