Lycos Europe was founded in 1997 when Lycos signed a joint venture agreement with German group Bertelsmann. Two years later (1999) they opened branches in several cities. In Spain, a delegation was opened that was run by Oscar Sanchez for 4 years, now General Manager for Tech Sales Group.

Bertelsmann group was the content leader in Europe after merging with Lycos - one out of 3 Europeans was a Lycos Europe user. They were overwhelmingly successful and it went public at 24€.

In May 2000, Lycos is bought by Terra Networks (Telefonica) for $12500.

They start buying strategically in Europe. They buy, among others, Swedish ISP Tiscali for 13 million Euros in August 2004, or Spray Network (8 portals in European countries) for 674 million Euros in September 2000, increasing the number of registered users to 8.5 million and 19 million visited pages.

Those were years of incredible success, but the dotcom crisis and bad management brought about its debacle.

At the beginning of 2004, Lycos lays off 100 workers in Europe, leaving 825. In 2005 half of the Spanish staff is laid off. They also offered them to move to other countries, especially Germany.

On the other hand, 34 IT people in France (out of 109) were offered to move to Armenia for 300€ ad 500€ a month - in other words, an offer they could not refuse.

With Telefonica and Bertelsmann group having 32% of Lycos shares (the rest in the free market), they decided to sell their equity share for 200 million Euros (Lycos was worth 10 billion Euros in the market in 2000). Today, Lycos shares are at 0.24€.

After years trying to find a buyer, they have now decided to stop their operations and save face by selling at least their domains and shopping sites.

Former General Manager in Spain perfectly explains the reasons that caused the failure of Lycos Europe. I quote:

“Instead of supporting its subsidiaries with a state-of-the-art technology regarding search engines, management spent their time promoting content with highly qualified and costly programmers and staff. They did not invest in technology or content. R&D was nonexistent. Google took the baton on search engines, and Lycos Europe was never able to find its niche. They wasted money. They wasted money on senseless TV ad campaigns, along with a terrible management, worth of being studied in business school as an example of what not to do.”

“A company cannot have more directors than workers, and this is what happened at Lycos Europe headquarters in Germany. They reached 400 workers, half of them holding a director’s position. I still remember a conference in Palma de Mallorca - of course - where I stood up during a management meeting and, in front of more than 100 directors, I asked how many of them had generated enough sales as to cover their paycheck. Only one stood up.”

Google’s virtual world platform, Lively, will foreclose on the 31^st of December. This was announced by Google on their blog.

Lively was launched by Google in July 2008, a mere four months ago. Apparently time enough to realise the service doesn’t work.

Lively is a virtual world platform where users can create their own incarnations and personalised rooms with several tools, that are free to try, and publish them on websites with an HTML code inlay.

Users communicated with each other by entering and gathering in the rooms of others, these, like any other chat room, could be public or private. They could even be decorated collectively.

Following the launch, everyone found similarities with Second Life (which isn’t precisely going through a good patch), but the truth is that any similarity with SL ended when you left a room as it didn’t allow you to wander around a complete virtual world, the way to move from one room to another was by surfing Lively’s website and selecting one from a list.

Another attempt by Google to take part in something slightly successful. In this case, they competed clearly with Second Life, which as I said, stopped being news months ago.

I have read articles that speak of total failure, dead-ly, etc. In my mind, Google did what they had to do, explore new markets and platforms with a possible market and a mass of users requesting it. In this instance it didn’t work out but, what are 4 months of work and investment for a company like Google? Pocket change.

But Lively isn’t the only problem, general virtual worlds are at a low, the only exception being the hugely successful World of Warcraft that is growing daily and is an incredible money making machine. But in this instance we are talking about a massive game with an almost permanent virtual world where every object is a jewel, precious objects that have sold on ebay for astronomical prices.

And the users, to communicate on a daily basis, prefer to use the old systems, like, e-mail, forums and chat rooms (virtual). You only need to take a look at Gmail and Groups statistics for the past year.

When a free service forecloses, the user conditions (that we never read) warn that they could foreclose whenever with no explanations or commitment, logical for a free service. The users who had scrupulously worked rooms and incarnations will no longer have them in 2009.

To say farewell to the service, Google has proposed to make captures and videos of their rooms to keep as a souvenir.

In an e-mail sent by Microsoft to groups administrators, it gives them the option to migrate their communities to a service of similar features, developed by Multiply for this purpose. The total closure of the service will take place on February 21st 2009.

According to Microsoft, this hasn’t been an easy decision. The reason of the closure is the new development of Live Groups, which will be launched on November 17th. But why don’t they wait for the development of this new service to be completed, and then migrate users?

According to Microsoft, it doesn’t make sense because of the irreconcilable differences between both services, differences that make impossible a migration. I can’t understand it because, from my point of view, everything is “migratable”, you must only want to do it. It’s in no way impossible -something different is that it is not profitable.

The options to keep the community data are reduced to migrate it automatically to Multiply. Any other option implies starting from scratch, including going on to Live Groups or to a competition’s service, of course.

I think this movement is not beneficial at all for Live nor Live Groups specifically, since they have left a large number of group administrators stranded, which will lose all the information gathered over the years, with the sole option of moving to Multiply.

I haven’t tried it out thoroughly, but I suspect this service is a fix made in a hurry that won’t have the quality of MSN Groups. Besides, there is the fact that Multiply is only offered in two languages, English and Japanese, which is causing many complaints from users.

Microsoft has enabled a Space to support migrations and answer the questions about this issue made by group administrators.