Friends Reunited, purchased by British 
television channel ITV for what now amounts to £175m, will probably have write-down the value of the acquisition when it releases its year-end review of past acquisitions.
The Sunday Times is reporting that the review, undertaken by ITV CEO John Cresswell, is expected to conclude that Friends Reunited is worth less than when it was purchased in December 2005. They bought it for £120m, but since the operation was able to meet specific goals, the price went up to £175m.
The fact that the site went down in value isn’t a surprise to me, as the company stopped charging users of its service last May as part of a larger plan to integrate Friends Reunited with ITV’s other dating and genealogy sites (Genes Reunited). They were also getting a lot of competition from other social networking sites like Facebook and Bebo.
At one time, the site had been charging £7.50 every six months. When a site goes from £15 annually to zip, what do they expect? It’s difficult for advertising money to make up for subscriptions. Friends Reunited launched in July 2000 and claims 19 million members worldwide.
For more information, see the January 4, 2009 article in the Times Online.