The social gaming site hi5 was acquired by the San Francisco-based Tagged on Wednesday. Tagged is the third-largest social networking site after Facebook and Twitter. The Wall Street Journal was first to report this acquisition. The terms of acquisition are not yet disclosed.
This acquisition is mainly for large user base. Currently Hi5 has about 200 million registered users where as Tagged has 100 million registered users. This acquisition would double Tagged user base said Greg Tseng, Tagged cofounder and CEO. In the press release yesterday, Tseng made the following statements about the acquisition.
“An opportunity of this magnitude is uncommon and exciting as the addition of hi5 immediately doubles our overall active user base and grows combined registered users past 330 million members. hi5’s global footprint complements Tagged’s and instantly builds on our leadership position as the world’s first, largest and best social network to meet new people.”
On the other hand, Alex St. John, president and chief technology officer of hi5 expressed his view about the acquisition as follows.
“Tagged is the perfect home for hi5 as it continues to prove itself as a major contender in social. At hi5 my colleagues and I recognized the unanswered opportunity to connect new people online, and I’m thrilled that Tagged is making strides to fulfill this mission.”
Hi5 was founded in 2003 by an Indian Ramu Yalamanchi. After five years of its creation, Hi5 was the third social networking site behind MySpace and Facebook. But when the Facebook started stepping into the international market Hi5 tried hard to remain competitive. In the February 2010, Hi5 acquired a social game developer Big Six which changed Hi5 into a social gaming site. Early this year, Hi5 also suffered from layoffs.
Currently Hi5 is available in over 50 languages, the site features localized games, virtual goods and other content that is monetized through hi5 Coins, a global virtual currency supporting over 60 payment methods and 30 currencies worldwide.
Tagged is profitable. The company’s revenue in 2010 accounts to $33 million and will end this year with the revenue between $43 million to $45 million says Tseng. Tagged may have a different strategy to compete with Facebook. It may want to become leaders in other spaces in order to compete with Facebook. It added about 50 employees starting this year and now has 200 people.
Currently Tagged is available in 220 countries. It allows anyone to meet and socialize with new people through social games, customized profiles, virtual gifts, advanced browsing features and more.