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AOL CEO Randy Falco just announced to employees that AOL will buy the social network Bebo. reports AOL paid $850 million. In the memo, Falco claims the acquisition "puts us squarely in a leading position in social media at a time when it's growing at a fantastic rate." Incorrect. We may not know what "social media" means, but we know how to define "leading." And the only thing Bebo leads in is down time. As of February 26, Bebo led all social networks with 12 hours and 28 minutes of down time since the beginning of 2008. Here's Falco's delusional memo in full.

Dear colleagues,

I've said many times that my vision for AOL is that we become a global, market-leading ad-supported digital media company. Today, we're taking a major step toward realizing this ambition.

We're announcing plans to acquire Bebo, a leading global social media network founded in 2005 that has a worldwide membership of 40 million.

This acquisition is game changing for AOL for a number of reasons. It puts us squarely in a leading position in social media at a time when it's growing at a fantastic rate. It will help power our strategic priorities across the board. And, just as important, by acquiring Bebo we can reclaim our heritage as a leader and innovator in the online community space.

Bebo is a true pioneer of the social Web. And, as a result, it has the most engaged audience and has seen tremendous growth - it's one of the leading social networks in the UK, ranked No. 1 in Ireland and New Zealand, and No. 3 in the U.S. With our AIM and ICQ networks, we will have a powerhouse reaching about 80 million unique users worldwide. Few other social networks can claim that reach.

And by bringing Bebo into the AOL family, under the continued leadership of its President Joanna Shields, we'll be able to accelerate its growth in the U.S., serving consumers here who are looking for the kind of superior social media experience Bebo provides. At the same time, the acquisition will provide us new opportunities to monetize a wider, more global, more deeply engaged audience through Platform-A. (You can read more about the acquisition here.)

In the past year, we've made great strides transforming AOL, through new product and programming launches and upgrades, our rapid international expansion and the creation of Platform-A. The Bebo acquisition, which we expect to close in the next month, supports all these efforts, and puts us in the game in the very important social media arena.

Please join me in congratulating everyone involved in this acquisition.