Photo sharing site Fotolog has been purchased by Hi-Media Group, a Paris-based interactive media company.
The deal involves a combination of cash and stock valued at around $90 million. Fotolog has an audience of more than 10 million member accounts.
Cyril Zimmermann, CEO of Hi-Media, said, “Hi-Media was attracted by Fotolog, which has only just begun converting its strong audience growth into revenues. We think that social networks are one of the pillars of what the Internet is and will be important in the years ahead, especially when underpinned by simple mechanisms.”
“We are also convinced that Hi-Media can benefit substantially from Fotolog’s efforts to generate maximum revenues from its audience thanks to the advertising and micro-payment services that Hi-Media has developed over the past decade. In addition, we believe that the expertise and experience of the Fotolog teams who are joining us will allow us to reinforce and accelerate the development of our publishing division.”
Fotolog launched in May 2002 and provides a platform for users to share photo postings or “photologs” with members and friends. Fotolog has seen solid growth this year, doubling the number of its member’s accounts to over 10 million, reaching 15 million unique monthly visitors and logging more than 3.3 billion in monthly page views.
Fotolog projects its revenue for 2007 will be about $2.3 million. Sales for the company have increased 245 percent since January and Fotolog says it will break even within six months following the acquisition.
John Borthwick, Fotolog Chief Executive Officer, said, “We found the ideal partner in Hi-Media Group to build on our strong momentum and monetize our fast-growing audience. This will be one of the biggest publicly-traded Internet pure plays in Europe, bringing together Hi-Media’s leading ad network and Fotolog’s large and highly-engaged user base. Hi-Media is committed to investing in Fotolog’s compelling member experience and growing the platform we have created.”
